Exhibit 13

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|TABLE of CONTENTS                                                                           |   
|------------------------------------------------------------------------------------------- | --
|                                                                                           
|FINANCIAL HIGHLIGHTS                                                                        | 1 
|A LETTER TO   OUR SHAREHOLDERS                                                              | 2 
|CONSOLIDATED   BALANCE SHEETS                                                               | 10
|CONSOLIDATED   STATEMENTS OF INCOME                                                         | 11
|CONSOLIDATED   STATEMENTS OF CHANGES IN SHAREHOLDERS EQUITY                                | 12
|CONSOLIDATED   STATEMENTS OF CASH FLOWS                                                     | 13
|NOTES TO   CONSOLIDATED FINANCIAL   STATEMENTS                                              | 14
|REPORTS OF   INDEPENDENT REGISTERED PUBLIC   ACCOUNTINGFIRM                                 | 40
|MANAGEMENTS REPORT   ON INTERNAL CONTROL oVER   FINANCIAL REPORTING                        | 42
|MANAGEMENTS   DISCUSSION AND ANALYSIS OF   FINANCIAL CONDITION AND RESULTS   OF OPERATIONS | 43
|SUPPLEMENTAL   FINANCIAL DATA: 10 -YEAR   HISTORY                                           | 72
|DIRECTORS AND   EXECUTIVE OFFICERS                                                          | 74
|SHAREHOLDER   INFORMATION                                                                   | 76
|                                                                                           

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FINANCIAL HIGHLIGHTS

|YEARS ENDED DECEMBER 31                         |  | 2005 |           | 2004 |   | 2003      |  
|----------------------------------------------- |  | ---- | --------- | ---- | - | --------- | -
|                                                | 
|(dollars in thousands, except per share data)   |  |      |           |      |   |           |  
|BALANCE   SHEET SUMMARY                         |  |      |           |      |   |           |  
|Assets                                          |  | $    | 8,458,740 |      | $ | 5,017,787 |  
|Deposits                                        |  |      | 7,275,346 |      |   | 4,100,152 |  
|Loans,   net                                    |  |      | 4,484,771 |      |   | 2,760,946 |  
|Common   shareholders equity                   |  |      | 689,775   |      |   | 599,591   |  
|                                                | 
|INCOME   STATEMENT SUMMARY                      |  |      |           |      |   |           |  
|Net   interest income                           |  | $    | 249,658   |      | $ | 151,464   |  
|Net   income                                    |  |      | 137,229   |      |   | 97,939    |  
|Cash   dividends paid to common shareholders    |  |      | 37,921    |      |   | 33,140    |  
|                                                | 
|PER SHARE   DATA                                |  |      |           |      |   |           |  
|Diluted   earnings                              |  | $    | 4.76      |      | $ | 3.40      |  
|Cash   dividends paid                           |  |      | 1.36      |      |   | 1.19      |  
|Book   value at year-end                        |  |      | 24.70     |      |   | 21.57     |  
|Market   value at year-end                      |  |      | 56.27     |      |   | 48.01     |  
|                                                | 
|FINANCIAL   RATIOS                              |  |      |           |      |   |           |  
|Return   on average common shareholders equity |  |      | 21.8      | %    |   | 17.4      | %
|Return   on average assets                      |  |      | 2.1       | %    |   | 2.4       | %
|Efficiency   ratio                              |  |      | 22.9      | %    |   | 33.5      | %
|                                                | 

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A LETTER to OUR SHAREHOLDERS

We are very pleased to report 2005 net
income of $137 million, or $4.76 per diluted share. Not only were 2005 earnings
a record, they were a 40% increase over 2004 earnings of $98 million (which were
themselves record earnings). In fact, the year-over-year results were even
better than first meets the eye due to substantial securities gains in 2004.
Without securities gains, 2005 net income would have been $129 million as
compared to $73 million for 2004, a $56 million increase and a 77%
year-over-year growth rate.

Among the many 2005 records:

| | Commercial real estate loan originations
hit $5.4 billion in 2005, up 34% from the $4.1 billion figure in 2004 and triple
the $1.8 billion achieved in 2003.                                                                                                                                                                                                                
|- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  |                                                                                                                                                                                                                                                                                                                                                                             
| | Commercial   real estate loan balances outstanding jumped to $4.4 billion at December 31,   2005, a $1.8 billion increase from the $2.6 billion balances at December 31,   2004, a 67% increase.                                                                                                                                                                            
|  |                                                                                                                                                                                                                                                                                                                                                                             
| | Total   commercial real estate loan commitments (outstanding balances plus unfunded   commitments) grew to $8.3 billion at December 31, 2005, up from $5.3 billion   at December 31, 2004. To put this achievement in perspective, the $3.0   billion of commitment growth in 2005 was greater than our total commercial   real estate loan commitments as of year-end 2002.
|  |                                                                                                                                                                                                                                                                                                                                                                             
| | As of   year-end 2005, our pipeline of pending commercial real estate loans stood   at over $6 billion.                                                                                                                                                                                                                                                                   
|  |                                                                                                                                                                                                                                                                                                                                                                             
| | We just   completed our sixth year in a row with absolutely $0 commercial real estate   loan charge-offs.                                                                                                                                                                                                                                                                   
|  |                                                                                                                                                                                                                                                                                                                                                                             
| | Total   deposits surged to nearly $7.3 billion at December 31, 2005, a $3.2 billion   increase from December 31, 2004.                                                                                                                                                                                                                                                      
|  |                                                                                                                                                                                                                                                                                                                                                                             
| | Total   shareholders equity climbed to $690 million at December 31, 2005, an   increase of $90 million from December 31, 2004  a 15% growth rate after   declaring $39 million in dividends to our shareholders.                                                                                                                                                          
|  |                                                                                                                                                                                                                                                                                                                                                                             
| | Total assets   of nearly $8.5 billion at December 31, 2005  a threshold that elevates Corus   to among the 100 largest banking companies in the United States.                                                                                                                                                                                                             
|  |                                                                                                                                                                                                                                                                                                                                                                             
| | An efficiency ratio of less than 23%. In
this measure, lower is better, and Corus 2005 results make it one of the
most efficient, among the top 3, large banking companies in the
country.                                                                                                                                                                                 
|  |                                                                                                                                                                                                                                                                                                                                                                             
| | A return on   shareholders equity of over 21%.                                                                                                                                                                                                                                                                                                                             

Ultimately, all of these accomplishments translated into our stock achieving a total return (including dividends) of more than 20% during 2005. While a substantial accomplishment during any year, it is all the more gratifying as 2005 was generally a rather weak year for the equity markets.

All in all, 2005 was an outstanding year for Corus and its shareholders. While we cant promise a repeat of such spectacular results in the coming years, we can promise to be just as focused and determined as ever.

2CORUS BANKSHARES 2005 ANNUAL REPORT

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COMMERCIAL REAL ESTATE PORTFOLIO

Corus has been active in the commercial real estate lending business since virtually our firms founding. With that said, this business has taken on an ever-growing importance for our company over the last ten years, growing from 40% of our loan portfolio ten years ago, to over 90% as of year-end 2005. We continue to be very pleased with the growth of the business, which included the addition of many new customers during the year and many new loans to existing customers. We are optimistic and forecasting that 2006 will bring another year of strong originations, growth in loans outstanding, and low amounts of charge-offs.

The growth in originations and outstanding commitments has been extremely strong, and it is therefore quite satisfying to tell you that:

| | We just   completed our sixth year in a row with absolutely $0 commercial real estate   loan charge-offs.                                                                                                                     
|- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  |                                                                                                                                                                                                                               
| | In fact,   over the last 10 years commercial real estate loan charge-offs have totaled   just $635 thousand, as compared to commercial real estate loan originations   of in excess of $16.2 billion over those same 10 years.
|  |                                                                                                                                                                                                                               
| | Nonperforming   loans at year-end were all but absent.                                                                                                                                                                        

Unorthodox StrategiesOver the last few years, we have discussed the various unorthodox strategies we have pursued in our commercial real estate lending business. As it is critical for shareholders to understand our lending approach, and as these strategies evolve over time, we again present this overview.

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A LETTER toOUR SHAREHOLDERS (continued)

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First, investing such a large portion of a banks assets in condominium construction and conversion loans is unusual in the banking industry and would commonly be considered a concentration of risk. While we understand this approach brings with it certain risks, we feel that it is important to focus on the business that we know best.

Second, Corus has been originating increasingly large commercial real estate loans. We actively use our legal lending limit, and we further supplement this with loans participated to the holding company. This allows Corus to make and keep in its portfolio loans as large as $175 million, which is unusual for a bank of our size or, for that matter, banks of any size. While our commercial real estate portfolio was made up of approximately 200 loans at December 31, 2005, the 45 largest loans averaged $93 million and made up half of our total loan portfolio. Concentrating on larger loans has various important benefits: (1) Focusing on larger loans allows involvement of senior management in each and every loan; (2) Larger loans seem to have better risk characteristics than small loans  such as developer expertise, which is generally higher in larger projects than smaller projects. The same could be
said about large projects on average having better architects and general contractors; and (3) We think that there is less competition associated with larger loans.

Third, it is unusual for a bank our size to lend nationwide. About 95% of our total loan commitments (outstanding balances plus unfunded commitments) are secured by properties outside of Illinois. We believe this geographic distribution provides us with an important form of diversification and mitigates our commercial real estate loan concentrations.

Fourth, we have instituted a unique commission-based compensation program for the commercial real estate loan officers. The purpose of the program is to reward commercial loan officers for new business development on the basis of each individual officers loan volume generation. An additional, and critical, aspect of this compensation program is that each officer shares in the risk of

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loss on the loans they generate. A substantial portion of officers commission is held back for many years and is at risk of loss in the event any of their loans fail to perform. The total value of those held back commissions was over $34 million at year-end 2005. This motivates our officers to make safe loans and it aligns the officers and Banks interests very closely. The program can be highly lucrative for the officers  the aggregate 2005 commissions for our 10 highest paid loan officers was $9.7 million. In order to manage the risks posed by such an arrangement, Robert Glickman, who is not in this commission program and who is a major shareholder, approves every large loan.

Residential Real Estate Market & Potential RisksA housing boom across much of the United States over the past five-plus years has brought about substantial escalation in housing prices. Some of the most pronounced price gains have occurred in many of the areas where the bank has the greatest concentration of loan exposure. This is to be expected. Developers are going to be most naturally drawn to develop projects in desirable and appreciating markets. In turn, those markets generally present the greatest new business opportunity for banks.

It would not surprise us if certain parts of the country were to experience a slowdown in the pace of sales and/or sales prices leveling off, or even declining. Mild dislocations in the markets where we are active will likely not create large problems for us, but could crimp new loan originations. Major dislocations (in values, absorption rates, or both) could lead to problem loans, charge-offs, as well as a dramatic decline in loan originations.

While we are keenly aware of the potential risks this presents, we continue to believe the condominium market presents us with attractive risk/reward lending opportunities.

DEPOSITS

While commercial real estate lending is clearly our engine for growth, this business is critically dependent upon funding and capital to support its growth. We will discuss financial strength, and thus capital, in the next section.

With respect to funding, virtually all of Corus funding comes from traditional deposit products. While banks have always coveted deposits, the last few years have witnessed a significant increase in the competition for deposits. We have therefore been all that much more fortunate to be able to grow our deposits so substantially over the past several years. Total deposits jumped to nearly $7.3 billion at December 31, 2005, up from $4.1 billion at December 31, 2004, and $2.8 billion at December 31, 2003. Put another way, the deposit growth of $3.2 billion in 2005 was greater than our total deposit base at year-end 2003.

FINANCIAL STRENGTH

While financial strength is the culmination of many factors, two of the most critical for banks are capital and liquidity. In both regards, Corus is very well situated.

CapitalMaintaining a solid capital base has been one of our guiding principles for many years. Towards that end, we have established an internal capital goal for Corus Bank that significantly exceeds the levels required by the Banks regulators. The goal is the sum of: (1) the amount required

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A LETTER to OUR SHAREHOLDERS (continued)

to meet the regulatory definition of well capitalized (the highest rating possible, which we discuss below), (2) a cushion to that regulatory threshold, and (3) the sum of potential future loan losses that might occur under a serious recession (on an after-tax basis, as charge-offs are tax deductible).

While the first two pieces of our capital goal are straightforward, the third part requires some explanation. Potential future loan losses related to some possible future event  under our capital goal that is the serious recession (a situation that clearly does not exist today)  are considered too speculative under Generally Accepted Accounting Principles to be used in determining a banks Allowance for Loan Losses. As such, banks are not allowed to book loan loss provisions related to such potential future events. Therefore, while we cant reserve for potential future losses in our Allowance, we can strengthen our capital position  and that is exactly what we are doing via the third part of our capital goal.

While bank loan losses have been very modest for many years now, and the economic environment still appears quite favorable, it is simply unrealistic to assume such a trend will persist forever. While we dont know when issues will arise (and therefore wont try to guess), our planning anticipates that at some time in the future we will have problem loans and, further, that we will have to foreclose on some properties. In such a scenario, we also anticipate that we would have to charge off portions of any problem loan such that the loan is written down to the then current appraised value of the property in the midst of a serious recession. Our goal is for the Bank to remain well capitalized after these charge-offs. We discuss this topic at length in the below section entitled Risk Assessment of Commercial Real Estate Portfolio.

In addition to maintaining a significant shareholder equity base, which grew to $690 million at December 31, 2005, we bolstered our capital position by issuing nearly $350 million of a unique form of long-term debt commonly referred to as Trust Preferred securities (they are listed though on our financial reports with the title, Long-Term Debt  Subordinated Debentures). Trust Preferred securities are essentially 30-year debt, with tax deductible interest payments, that: (a) have no financial covenants, (b) are not puttable back to Corus, (c) include an option for Corus to call them at par beginning five years after issuance, and (d) allow for interest payments to be deferred for up to five consecutive years without triggering an event of default (this provision is subject, however, to certain restrictions with regard to Corus
ability to make, among other things, dividends to holders of Corus common stock).

Importantly, and as a result of Trust Preferred securities having so many equity-like features, the Federal Reserve allows bank holding companies to include these (up to certain limits) in the regulatory calculation of capital. This inclusion of Trust Preferred brings our Companys total capital to well over $1 billion. While there are several different regulatory capital hurdles, each of which must be cleared, the most important one for Corus is the Total Risk-Based Capital to Risk-Adjusted Assets. A banking company must have a ratio by this measure of over 10% in order to achieve the highest rating, which the regulators term well capitalized. As of year-end 2005, our Bank had a ratio of 12.6% and the consolidated company 14.4%. At these levels, we are operating our Company at literally hundreds of millions of dollars above and beyond the levels required to meet the
highest regulatory requirement.

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We would like
to finish our capital discussion by commenting on what we believe is an
understandable, but nonetheless oversimplified attempt to gauge the adequacy of
a banks capital position. The most common, and potentially the most
flawed, measure is the classic comparison of equity to total assets. In
Corus case, this measure is exceptionally misleading as $3.5 billion of
our total assets  well over 40%  are in very high-quality and
short-term securities. Common sense would argue very little, if any, equity
needs to be kept behind such extremely safe instruments. In fact, the bank
regulators do take this position when they use a process of
risk-weighting assets.

LiquidityBanks must stand ready at all times to meet depositors withdrawal requests and to fund disbursements under outstanding loan commitments. In order to have cash available at all times for these needs, the Bank maintains very high levels of liquid investments  over $3.5 billion at yearend 2005, as mentioned above. These investments are held in the form of overnight loans to other major banks and high-quality short-term marketable securities (primarily, U.S. Government Agency securities and U.S. Treasuries). It is important to note that virtually none of these liquid investments are pledged as collateral for any borrowings of the Bank.

In regard to outstanding loan commitments, construction loans, which are a significant part of our business, tend to start with very low balances and thus bring about large unfunded commitments. Our commitments on commercial real estate construction loans are intended to be, and in fact must be (if the borrower is to complete the project), drawn down. We thus expect to fund 100% of these committed amounts and generally expect these fundings to take place over the next two years. As of December 31, 2005, Corus had total unfunded loan commitments of about $3.9 billion. Loan paydowns/payoffs work in the opposite direction, acting as a source of future funding. (For further information on this topic, please refer to the Liquidity and Capital Resources section in the Managements Discussion and Analysis section of this annual report.)

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A LETTER to OUR SHAREHOLDERS (continued)

RISK ASSESSMENT OF COMMERCIAL REAL ESTATE PORTFOLIO

Our strong capital position, combined with our large pool of liquid investments, has positioned Corus to weather the adversities that could result from a serious recession. During the recession of 19891992, most banks that had foreclosed real estate were required, either by the bank regulators or the stock market, to sell their problem loans and their foreclosed real estate at tremendous losses during the depths of the recession. As discussed above, our planning anticipates that at some point in the future we will have problem loans and, further, that we will have to foreclose on some properties. In such a scenario, we also anticipate that we would have to charge off portions of any problem loan such that the loan is written down to the then current appraised value of the property in the midst of a serious recession. It is our desire to have the ability to hold foreclosed real estate until markets have stabilized and values have recovered.

Corus has spent many years developing and refining an internal loan rating system to better understand the risks inherent in our commercial real estate portfolio. This system provides us with an insight into potential levels of nonperforming loans and charge-offs for the portfolio as a whole. It is important for our shareholders to understand that Corus business strategy of originating (and retaining) large amounts of commercial real estate loans, while quite successful and lucrative to date, presents some material risks.

The foundation of our internal loan rating system is managements estimation of the Probability of Default (POD) and Loss Given Default (LGD) for each of our commercial real estate loans if a serious recession were to occur. (As an example, we look to the severe declines in property values experienced in California and New England during the late 1980s and early 1990s.) The POD is our estimate of how likely it is, given a serious recession, a loan would go into default while the LGD is our estimate, given such a default, of what percentage of the loan would have to be charged off. Our internal loan rating system involves stressing all major assumptions regarding the cash flow and/or values of the underlying real estate down to levels that could manifest themselves during a serious recession. Under such a scenario, and based on current loan commitments, our
system indicates that we could have $1.3 billion of defaulted commercial real estate loans and $239 million of potential charge-offs related to those loans.

At this point, a few words of caution are in order. While our internal loan rating system generates very precise numbers, and we have worked hard to arrive at inputs we believe reasonable, this precision is more a function of the mathematical nature of the model than a belief on our part that we can predict future results with any such certainty. Our model, like all models, requires myriad assumptions and, in this case, assumptions about how vulnerable each and every individual loan will be to a serious recession at some unknown point in the future. Also, the lack of charge-offs in our commercial real estate portfolio leaves us without a tangible means by which to refine our estimates. Thus, while we have attempted to be conservative in our assessment of potential defaults and losses, it is conceivable that actual defaults and/or losses may be greater, perhaps materially, than estimated. It is also
worth noting that while our approach is based on a serious recession, it is certainly possible that we could experience meaningful nonperforming loans and charge-offs even in the absence of such a recession.

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While we have spent considerable time discussing our business plan with you  the owners  and with our banking regulators, reporting nonperforming loans and charge-offs at the levels outlined above could nonetheless lead to, among other things, an adverse reaction on the part of our bank regulators, bad publicity, a sharp decline in our stock price, and deposit withdrawals. While this is not a scenario we find appealing, in fact it would be extremely unpleasant for all of us, it is one that we all need to be aware could occur and plan for accordingly. This is the reason we keep such extremely high levels of liquidity and capital.

A final, and highly interrelated, point is that we judge the success of our business plan, and its results, not based on the results of any one given year but rather from the perspective of a full business cycle. Unlike some business models that give rise to recurring losses, with some ebb and flow depending on the phase of the economic cycle, our model has generated virtually no losses for a decade now. With that said, and as we have discussed, we anticipate we could incur substantial losses during a serious recession. Neither the complete absence nor the presence of losses can be viewed in isolation from the other, both must be taken into account when gauging the success of a strategy. This is critical to understand.

THANKS TO OUR PARTNERS

For our shareholders, we wish to thank you for the confidence you have displayed by buying and holding our stock. We think of you as our partners and pledge to treat you with respect and work hard to make your investment worthwhile. For our customers, we wish to thank you for your past business and we look forward to a long future with you. For our officers and employees, we sincerely thank you for your many contributions to our success and tell you again that we are proud of you and the job that you are doing.

Sincerely,

|/s/ JOSEPH C.   GLICKMAN |  | /s/ ROBERT J. GLICKMAN                 
|------------------------ |  | ---------------------------------------
|                         |  |                                        
|JOSEPH C.   GLICKMAN     |  | ROBERT J.   GLICKMAN                   
|Chairman of   the Board  |  | President   and Chief Executive Officer

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CONSOLIDATED BALANCE SHEETS

|DECEMBER 31                                                                                                        |  |   | 2005      |  |   | 2004      | 
|------------------------------------------------------------------------------------------------------------------ |  | - | --------- |  | - | --------- | 
|                                                                                                                   | 
|(dollars in thousands, except per share data)                                                                      |  |   |           |  |   |           | 
|ASSETS                                                                                                             |  |   |           |  |   |           | 
|Cash and due from banks  noninterest-bearing                                                                      |  | $ | 133,351   |  | $ | 55,806    | 
|Federal funds sold                                                                                                 |  |   | 325,000   |  |   | 1,473,500 | 
|                                                                                                                   | 
|Cash and Cash Equivalents                                                                                          |  |   | 458,351   |  |   | 1,529,306 | 
|Securities:                                                                                                        |  |   |           |  |   |           | 
|Available-for-sale, at fair value                                                                                  |  |   |           |  |   |           | 
|Common stocks (cost
$110,586 and $128,620)                                                                         |  |   | 184,541   |  |   | 219,099   | 
|U.S. Government and agencies (amortized cost $3,234,257 and $427,868)                                              |  |   | 3,228,016 |  |   | 427,687   | 
|Other securities (amortized cost $15,039 and $19,314)                                                              |  |   | 15,611    |  |   | 19,839    | 
|Held-to-maturity, at amortized cost (fair value
$14,470 and $12,353)                                               |  |   | 14,470    |  |   | 12,344    | 
|                                                                                                                   | 
|Total Securities                                                                                                   |  |   | 3,442,638 |  |   | 678,969   | 
|Loans, net of unearned income                                                                                      |  |   | 4,524,511 |  |   | 2,793,828 | 
|Less: Allowance for loan losses                                                                                    |  |   | 39,740    |  |   | 32,882    | 
|                                                                                                                   | 
|Loans, net                                                                                                         |  |   | 4,484,771 |  |   | 2,760,946 | 
|Premises and equipment, net                                                                                        |  |   | 26,439    |  |   | 25,399    | 
|Accrued interest receivable and other assets                                                                       |  |   | 42,018    |  |   | 18,644    | 
|Goodwill, net of accumulated amortization of $30,009                                                               |  |   | 4,523     |  |   | 4,523     | 
|                                                                                                                   | 
|Total Assets                                                                                                       |  | $ | 8,458,740 |  | $ | 5,017,787 | 
|                                                                                                                   | 
|LIABILITIES AND SHAREHOLDERS EQUITY                                                                               |  |   |           |  |   |           | 
|Liabilities:                                                                                                       |  |   |           |  |   |           | 
|Deposits:                                                                                                          |  |   |           |  |   |           | 
|Noninterest-bearing                                                                                                |  | $ | 337,399   |  | $ | 235,700   | 
|Interest-bearing                                                                                                   |  |   | 6,937,947 |  |   | 3,864,452 | 
|                                                                                                                   | 
|Total Deposits                                                                                                     |  |   | 7,275,346 |  |   | 4,100,152 | 
|Long-term debt  subordinated debentures                                                                           |  |   | 358,254   |  |   | 255,158   | 
|Federal funds purchased                                                                                            |  |   | 41,200    |  |   |          | 
|Other borrowings                                                                                                   |  |   | 21,593    |  |   | 6,931     | 
|Accrued interest payable and other liabilities                                                                     |  |   | 72,572    |  |   | 55,955    | 
|                                                                                                                   | 
|Total Liabilities                                                                                                  |  |   | 7,768,965 |  |   | 4,418,196 | 
|Shareholders equity:                                                                                              |  |   |           |  |   |           | 
|Common stock, $0.05 par value, 50,000,000 shares authorized; 27,924,744 and 27,795,648 shares issued, respectively |  |   | 1,396     |  |   | 1,390     | 
|Surplus                                                                                                            |  |   | 27,278    |  |   | 21,243    | 
|Equity  options outstanding                                                                                       |  |   | 7,770     |  |   | 6,737     | 
|Retained earnings                                                                                                  |  |   | 609,334   |  |   | 512,844   | 
|Accumulated other comprehensive income                                                                             |  |   | 43,997    |  |   | 57,377    | 
|                                                                                                                   | 
|Total Shareholders  Equity                                                                                        |  |   | 689,775   |  |   | 599,591   | 
|                                                                                                                   | 
|Total Liabilities and Shareholders Equity                                                                         |  | $ | 8,458,740 |  | $ | 5,017,787 | 
|                                                                                                                   | 
|                                                                                                                   |  |   |           |  |   |           | 

See accompanying notes.

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CONSOLIDATED STATEMENTS of INCOME

|YEARS ENDED DECEMBER 31                                                   |  |   | 2005    |  |   | 2004    |  |   | 2003    | 
|------------------------------------------------------------------------- |  | - | ------- |  | - | ------- |  | - | ------- | 
|                                                                          | 
|(in   thousands, except per share data)                                   |  |   |         |  |   |         |  |   |         | 
|INTEREST,   LOAN FEES, AND DIVIDEND INCOME                                |  |   |         |  |   |         |  |   |         | 
|Interest   and fees on loans:                                             |  |   |         |  |   |         |  |   |         | 
|Taxable                                                                   |  | $ | 346,664 |  | $ | 193,724 |  | $ | 151,523 | 
|Tax-advantaged                                                            |  |   | 136     |  |   | 118     |  |   | 158     | 
|Federal   funds sold                                                      |  |   | 21,936  |  |   | 16,335  |  |   | 4,912   | 
|Securities:                                                               |  |   |         |  |   |         |  |   |         | 
|Taxable                                                                   |  |   | 71,561  |  |   | 5,004   |  |   | 7,537   | 
|Dividends                                                                 |  |   | 6,559   |  |   | 6,287   |  |   | 5,311   | 
|Tax-advantaged                                                            |  |   | 93      |  |   | 95      |  |   | 63      | 
|Trading   account                                                         |  |   |        |  |   | 496     |  |   | 735     | 
|                                                                          | 
|Total   Interest, Loan Fees, and Dividend Income                          |  |   | 446,949 |  |   | 222,059 |  |   | 170,239 | 
|                                                                          | 
|INTEREST   EXPENSE                                                        |  |   |         |  |   |         |  |   |         | 
|Deposits                                                                  |  |   | 178,497 |  |   | 60,370  |  |   | 43,836  | 
|Long-term   debt  subordinated debentures                                |  |   | 17,991  |  |   | 9,354   |  |   | 1,812   | 
|Other   borrowings                                                        |  |   | 803     |  |   | 871     |  |   | 1,164   | 
|                                                                          | 
|Total   Interest Expense                                                  |  |   | 197,291 |  |   | 70,595  |  |   | 46,812  | 
|                                                                          | 
|Net   Interest Income                                                     |  |   | 249,658 |  |   | 151,464 |  |   | 123,427 | 
|Provision   for credit losses                                             |  |   | 6,000   |  |   |        |  |   |        | 
|                                                                          | 
|Net   Interest Income After Provision for Credit Losses                   |  |   | 243,658 |  |   | 151,464 |  |   | 123,427 | 
|                                                                          | 
|NONINTEREST   INCOME                                                      |  |   |         |  |   |         |  |   |         | 
|Service   charges on deposit accounts                                     |  |   | 11,566  |  |   | 11,438  |  |   | 11,878  | 
|Securities   gains/(losses), net                                          |  |   | 12,691  |  |   | 37,349  |  |   | 2,366   | 
|Other   income                                                            |  |   | 3,692   |  |   | 2,628   |  |   | 2,676   | 
|                                                                          | 
|Total   Noninterest Income                                                |  |   | 27,949  |  |   | 51,415  |  |   | 16,920  | 
|                                                                          | 
|NONINTEREST   EXPENSE                                                     |  |   |         |  |   |         |  |   |         | 
|Employee   compensation and benefits                                      |  |   | 43,136  |  |   | 38,458  |  |   | 34,426  | 
|Net   occupancy                                                           |  |   | 3,723   |  |   | 3,764   |  |   | 4,231   | 
|Data   processing                                                         |  |   | 1,714   |  |   | 2,435   |  |   | 2,722   | 
|Depreciation    furniture and equipment                                  |  |   | 1,444   |  |   | 1,750   |  |   | 1,823   | 
|Other   expenses                                                          |  |   | 11,305  |  |   | 9,866   |  |   | 9,331   | 
|                                                                          | 
|Total   Noninterest Expense                                               |  |   | 61,322  |  |   | 56,273  |  |   | 52,533  | 
|                                                                          | 
|Income   Before Income Taxes                                              |  |   | 210,285 |  |   | 146,606 |  |   | 87,814  | 
|Income   tax expense                                                      |  |   | 73,056  |  |   | 48,667  |  |   | 29,404  | 
|                                                                          | 
|Net Income                                                                |  | $ | 137,229 |  | $ | 97,939  |  | $ | 58,410  | 
|                                                                          | 
|Net income per share:                                                     |  |   |         |  |   |         |  |   |         | 
|Basic                                                                     |  | $ | 4.93    |  | $ | 3.51    |  | $ | 2.08    | 
|Diluted                                                                   |  |   | 4.76    |  |   | 3.40    |  |   | 2.04    | 
|Cash dividends declared per   common share                                |  |   | 1.40    |  |   | 1.25    |  |   | 0.83    | 
|Weighted average common   shares and common share equivalents outstanding |  |   | 28,855  |  |   | 28,818  |  |   | 28,703  | 
|                                                                          | 
|                                                                          |  |   |         |  |   |         |  |   |         | 

See accompanying notes.

CORUS BANKSHARES 2005 ANNUAL REPORT     11

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CONSOLIDATED STATEMENTS of CHANGES in SHAREHOLDERS EQUITY

|                                                                                                |  | COMMON    STOCK |           | SURPLUS |  | EQUITY    OPTIONS    OUTSTANDING |   | RETAINED    EARNINGS |           | ACCUMULATED   OTHER   COMPREHENSIVE   INCOME |  | TOTAL       |  
|----------------------------------------------------------------------------------------------- |  | --------------- | --------- | ------- |  | --------------------------------- | - | -------------------- | --------- | -------------------------------------------- |  | ----------- | -
|                                                                                                | 
|(dollars   in thousands, except per share data)                                                 |  |                 |           |         |  |                                   |   |                      |           |                                              |  |             |  
|Balance   at December 31, 2002
(1)                                                              |  |                 | $   1,412 |         |  | $   16,668                        |   |                      | $        |                                              |  | $   430,482 |  
|Adoption of SFAS 123                                                                            |  |                 |          |         |  | (3,115                            | ) |                      | 4,256     |                                              |  |            |  
|Net income                                                                                      |  |                 |          |         |  |                                  |   |                      |          |                                              |  | 58,410      |  
|Other comprehensive income:                                                                     |  |                 |           |         |  |                                   |   |                      |           |                                              |  |             |  
|Changes   in net unrealized gains on securities                                                 |  |                 |          |         |  |                                  |   |                      |          |                                              |  |            |  
|Reclassification   adjustment for net gains realized in net income                              |  |                 |          |         |  |                                  |   |                      |          |                                              |  |            |  
|Income   tax effect                                                                             |  |                 |          |         |  |                                  |   |                      |          |                                              |  |            |  
|                                                                                                |  |                 |           |         |  |                                   |   |                      |           |                                              |  |             |  
|Comprehensive   Income                                                                          |  |                 |           |         |  |                                   |   |                      |           |                                              |  |             |  
|Stock options vested                                                                            |  |                 |          |         |  |                                  |   |                      | 1,711     |                                              |  |            |  
|Shares issued under the   stock option plan, 29,600 common shares                               |  |                 | 2         |         |  | 688                               |   |                      | (168      | )                                            |  |            |  
|Stock option settlements                                                                        |  |                 |          |         |  | (102                              | ) |                      | (129      | )                                            |  |            |  
|Deferred compensation                                                                           |  |                 |          |         |  | 2,898                             |   |                      |          |                                              |  |            |  
|Retirement of 231,200 common   shares                                                           |  |                 | (12       | )       |  | (95                               | ) |                      |          |                                              |  | (5,136      | )
|Cash dividends declared on   common stock, $0.830 per common share                              |  |                 |          |         |  |                                  |   |                      |          |                                              |  | (23,298     | )
|                                                                                                | 
|Balance   at December 31, 2003                                                                  |  |                 | $   1,402 |         |  | $   16,942                        |   |                      | $   5,670 |                                              |  | $   460,458 |  
|Net income                                                                                      |  |                 |          |         |  |                                  |   |                      |          |                                              |  | 97,939      |  
|Other comprehensive income:                                                                     |  |                 |           |         |  |                                   |   |                      |           |                                              |  |             |  
|Changes   in net unrealized gains on securities                                                 |  |                 |          |         |  |                                  |   |                      |          |                                              |  |            |  
|Reclassification   adjustment for net gains realized in net income                              |  |                 |          |         |  |                                  |   |                      |          |                                              |  |            |  
|Income   tax effect                                                                             |  |                 |          |         |  |                                  |   |                      |          |                                              |  |            |  
|                                                                                                |  |                 |           |         |  |                                   |   |                      |           |                                              |  |             |  
|Comprehensive   Income                                                                          |  |                 |           |         |  |                                   |   |                      |           |                                              |  |             |  
|Stock options vested                                                                            |  |                 |          |         |  |                                  |   |                      | 1,402     |                                              |  |            |  
|Shares issued under the   stock option plan, 23,860 common shares                               |  |                 | 1         |         |  | 828                               |   |                      | (183      | )                                            |  |            |  
|Stock option settlements                                                                        |  |                 |          |         |  | (272                              | ) |                      | (94       | )                                            |  |            |  
|Stock option expirations                                                                        |  |                 |          |         |  | 38                                |   |                      | (58       | )                                            |  |            |  
|Deferred compensation                                                                           |  |                 |          |         |  | 3,783                             |   |                      |          |                                              |  |            |  
|Retirement of 265,100 common   shares                                                           |  |                 | (13       | )       |  | (76                               | ) |                      |          |                                              |  | (10,732     | )
|Cash dividends declared on   common stock, $1.250 per common share                              |  |                 |          |         |  |                                  |   |                      |          |                                              |  | (34,821     | )
|                                                                                                | 
|Balance   at December 31, 2004                                                                  |  |                 | $   1,390 |         |  | $   21,243                        |   |                      | $   6,737 |                                              |  | $   512,844 |  
|Net income                                                                                      |  |                 |          |         |  |                                  |   |                      |          |                                              |  | 137,229     |  
|Other comprehensive income:                                                                     |  |                 |           |         |  |                                   |   |                      |           |                                              |  |             |  
|Changes   in net unrealized gains on securities                                                 |  |                 |          |         |  |                                  |   |                      |          |                                              |  |            |  
|Reclassification   adjustment for net gains realized in net income                              |  |                 |          |         |  |                                  |   |                      |          |                                              |  |            |  
|Income   tax effect                                                                             |  |                 |          |         |  |                                  |   |                      |          |                                              |  |            |  
|                                                                                                |  |                 |           |         |  |                                   |   |                      |           |                                              |  |             |  
|Comprehensive   Income                                                                          |  |                 |           |         |  |                                   |   |                      |           |                                              |  |             |  
|Stock options vested                                                                            |  |                 |          |         |  |                                  |   |                      | 1,682     |                                              |  |            |  
|Shares issued under the   stock option plan, 100,680 common shares                              |  |                 | 5         |         |  | 3,591                             |   |                      | (635      | )                                            |  |            |  
|Stock option settlements                                                                        |  |                 |          |         |  | (46                               | ) |                      | (14       | )                                            |  |            |  
|Deferred compensation                                                                           |  |                 |          |         |  | 1,745                             |   |                      |          |                                              |  |            |  
|Shares issued under the   Commission Program for Commercial Loan Officers, 60,216 common shares |  |                 | 3         |         |  | 757                               |   |                      |          |                                              |  |            |  
|Retirement of 31,800 common   shares                                                            |  |                 | (2        | )       |  | (12                               | ) |                      |          |                                              |  | (1,734      | )
|Cash dividends declared on   common stock, $1.400 per common share                              |  |                 |          |         |  |                                  |   |                      |          |                                              |  | (39,005     | )
|                                                                                                | 
|Balance   at December 31, 2005                                                                  |  |                 | $   1,396 |         |  | $   27,278                        |   |                      | $   7,770 |                                              |  | $   609,334 |  
|                                                                                                | 

|See accompanying notes.                                            
|-------------------------------------------------------------------
|(1)Amounts restated to   reflect a 100% stock dividend on 12/15/03.

12CORUS BANKSHARES 2005 ANNUAL REPORT

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CONSOLIDATED STATEMENTS of CASH FLOWS

|YEARS ENDED DECEMBER 31                                                           |  | 2005 |            | 2004 |   | 2003      |  
|--------------------------------------------------------------------------------- |  | ---- | ---------- | ---- | - | --------- | -
|                                                                                  | 
|(dollars in thousands)                                                            |  |      |            |      |   |           |  
|CASH FLOWS FROM OPERATING ACTIVITIES                                              |  |      |            |      |   |           |  
|Net income                                                                        |  | $    | 137,229    |      | $ | 97,939    |  
|Adjustments to reconcile net income to net cash provided by operating activities: |  |      |            |      |   |           |  
|Provision for credit losses                                                       |  |      | 6,000      |      |   |          |  
|Depreciation and amortization                                                     |  |      | 2,185      |      |   | 2,524     |  
|(Accretion) amortization of investment and loan (discounts) premiums, net         |  |      | (46,185    | )    |   | 443       |  
|Deferred income tax (benefit)/expense                                             |  |      | (4,011     | )    |   | 1,416     |  
|Securities (gains)/losses, net                                                    |  |      | (12,691    | )    |   | (37,349   | )
|Proceeds from trading activity, net                                               |  |      |           |      |   | 4,229     |  
|Deferred compensation expense                                                     |  |      | 3,870      |      |   | 5,108     |  
|Payment of deferred compensation                                                  |  |      | (815       | )    |   |          |  
|Stock option expense                                                              |  |      | 1,682      |      |   | 1,402     |  
|Gain on sale of premises and equipment                                            |  |      | (1,420     | )    |   |          |  
|(Increase) decrease in accrued interest receivable and other assets               |  |      | (23,374    | )    |   | 1,370     |  
|Increase (decrease) in accrued interest payable and other liabilities             |  |      | 28,170     |      |   | 3,315     |  
|                                                                                  | 
|Net Cash Provided by Operating Activities                                         |  |      | 90,640     |      |   | 80,397    |  
|                                                                                  | 
|CASH FLOWS FROM INVESTING ACTIVITIES                                              |  |      |            |      |   |           |  
|Proceeds from sales/maturities of held-to-maturity securities                     |  |      | 692        |      |   | 671       |  
|Purchases of held-to-maturity securities                                          |  |      | (2,818     | )    |   | (1,258    | )
|Proceeds from maturities of available-for-sale securities                         |  |      | 2,711,492  |      |   | 209,218   |  
|Proceeds from sales of available-for-sale securities                              |  |      | 460,004    |      |   | 15,559    |  
|Purchases of available-for-sale securities                                        |  |      | (5,893,812 | )    |   | (424,001  | )
|Proceeds from sales of non-hedge derivatives                                      |  |      |           |      |   | 7,800     |  
|Net increase in loans                                                             |  |      | (1,731,421 | )    |   | (360,670  | )
|Recoveries of previously charged-off loans                                        |  |      | 1,785      |      |   | 2,099     |  
|Purchases of premises and equipment                                               |  |      | (3,873     | )    |   | (1,610    | )
|Proceeds from sale of premises and equipment                                      |  |      | 2,068      |      |   |          |  
|                                                                                  | 
|Net Cash Used in Investing Activities                                             |  |      | (4,455,883 | )    |   | (552,192  | )
|                                                                                  | 
|CASH FLOWS FROM FINANCING ACTIVITIES                                              |  |      |            |      |   |           |  
|Increase in deposit accounts                                                      |  |      | 3,175,194  |      |   | 1,253,750 |  
|Net proceeds from issuance of long-term debt  subordinated debentures            |  |      | 100,000    |      |   | 75,000    |  
|Repayment of debt                                                                 |  |      |           |      |   | (35,000   | )
|Increase in federal funds purchased                                               |  |      | 41,200     |      |   |          |  
|Increase (decrease) in other borrowings, net                                      |  |      | 14,662     |      |   | 5,528     |  
|Stock option exercises/settlements                                                |  |      | 2,901      |      |   | 260       |  
|Retirements of common shares                                                      |  |      | (1,748     | )    |   | (10,821   | )
|Cash dividends paid on common shares                                              |  |      | (37,921    | )    |   | (33,140   | )
|                                                                                  | 
|Net Cash Provided by Financing Activities                                         |  |      | 3,294,288  |      |   | 1,255,577 |  
|                                                                                  | 
|Net (Decrease) Increase in Cash and Cash Equivalents                              |  |      | (1,070,955 | )    |   | 783,782   |  
|Cash and cash equivalents at beginning of year                                    |  |      | 1,529,306  |      |   | 745,524   |  
|                                                                                  | 
|Cash and Cash Equivalents at End of Year                                          |  | $    | 458,351    |      | $ | 1,529,306 |  
|                                                                                  | 
|Supplemental disclosures:                                                         |  |      |            |      |   |           |  
|Interest paid                                                                     |  | $    | 174,624    |      | $ | 66,217    |  
|Income taxes paid                                                                 |  |      | 74,955     |      |   | 48,950    |  
|                                                                                  | 

See accompanying notes.

CORUS BANKSHARES 2005 ANNUAL REPORT     13

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NOTES to CONSOLIDATED FINANCIAL STATEMENTS

|NOTE 1SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
|------------------------------------------------
|                                                

The consolidated financial statements include the accounts of Corus Bankshares, Inc. (Corus or the Company) and its wholly-owned subsidiary, Corus Bank, N.A. (the Bank). Corus, through its subsidiary bank, provides retail banking services primarily in the Chicago metropolitan area. In addition, Corus commercial lending group provides financing nationwide, almost exclusively collateralized by real estate. In the preparation of the consolidated financial statements, management is required to make certain estimates and assumptions that affect the reported amounts contained in the consolidated financial statements. Management believes that the estimates made are reasonable; however, changes in estimates may be required if economic or other conditions change significantly beyond managements expectations. See Allowance for Credit Losses accounting policies below.

PRINCIPLES OF CONSOLIDATION

The accompanying consolidated financial statements include the accounts of Corus and the Bank. All intercompany accounts and transactions have been eliminated in the consolidated financial statements.

In accordance with Financial Accounting Standards Board Interpretation No. 46(R), Consolidation of Variable Interest Entities (FIN 46(R)), the accompanying consolidated financial statements do not include the accounts of 11 wholly-owned finance subsidiaries (the Trusts). The Trusts were formed for the sole purpose of issuing Trust Preferred securities and, in turn, purchasing subordinated debentures from the Company.

Under the provisions of FIN 46(R), the Trusts are considered Variable Interest Entities (VIEs) which can only be consolidated if Corus is subject to a majority of the risk of loss from each of the VIEs activities or is entitled to receive a majority of each entitys residual returns. The design of the Trusts, which is very common in the banking industry, is such that Corus is neither subject to the majority of risk of loss nor entitled to receive the majority of any residual returns. As a result, the Trusts are not consolidated.

Corus does, however, report the subordinated debentures sold to the Trusts as a liability in the Consolidated Balance Sheets and associated interest expense in the Consolidated Statements of Income.

SEGMENT REPORTING

Statement of Financial Accounting Standards No. 131, Disclosures about Segments of an Enterprise and Related Information, requires companies to report certain financial information about operating segments. Corus is currently managed as one unit and does not have separate operating segments. The Companys chief operating decision-makers use consolidated results to make operating and strategic decisions.

CASH AND CASH EQUIVALENTS

Cash and cash equivalents include cash, due from banks, and federal funds sold which have an original maturity of 90 days or less.

SECURITIES

Management determines the appropriate classification of debt securities at the time of purchase and reevaluates such designation as of each balance sheet date.

Trading account securities are held for sale in anticipation of short-term gains and are stated at fair value. Realized and unrealized gains and losses on trading account securities are reflected in the Consolidated Statements of Income in securities gains/(losses), net.

Available-for-sale
securities are those securities to be held for indefinite periods of time. These
securities include those that management intends to use as part of its
asset/liability management strategy and may be sold in response to changes in
interest rates, market conditions or other reasons. These securities are carried
at fair value. The difference between amortized cost and fair value, less
deferred income taxes, is reflected as a

14     CORUS BANKSHARES 2005 ANNUAL REPORT

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component of other comprehensive income
in the Consolidated Statements of Changes in Shareholders Equity.
Amortized cost represents the cost of securities plus or minus the
amortization/accretion of premium/discount, adjusted for losses associated with
other than temporary declines in value.

Securities held-to-maturity represent securities that Corus has the ability and positive intent to hold to maturity. These securities are carried at amortized cost.

Interest and dividend income, including amortization of premiums and accretion of discounts, are included in interest, loan fees, and dividend income. Realized gains and losses are determined on a specific identification basis. Gains or losses from available-for-sale securities are recognized either when the investment is sold or when the company is acquired by another company, regardless of whether the acquisition price is paid in cash or stock. Provisions are made to write down the value of securities for declines in value that are other than temporary.

LOANS

Loans are reported at the principal amount outstanding, net of any unearned discount or deferred origination or exit fees. Interest income is recognized using the level-yield method. Loan origination and exit fees, net of direct costs related to the origination, are deferred and amortized as a yield adjustment over the lives of the related loans.

The accrual of interest income is discontinued on any loan when there is reasonable doubt as to the ultimate collectibility of interest or principal. Loans past due over 90 days continue to accrue interest income only if there are adequate sources of repayment. These sources include sufficient collateral to cover repayment of the loan or other designated sources of repayment. When a loan is placed on nonaccrual status, unpaid interest credited to income in the current year is reversed and unpaid interest accrued in prior years is charged against the allowance for credit losses. Interest received on nonaccrual loans generally is either applied against principal or reported as interest income, according to managements judgment as to the collectibility of principal. Generally, loans are restored to accrual status when the obligation is brought current, has performed in accordance with contractual
terms for a reasonable period of time and the ultimate collectibility of the total contractual principal and interest is no longer in doubt.

In accordance with Statement of Financial Accounting Standards No. 114, Accounting by Creditors for Impairment of a Loan (SFAS 114), Corus classifies loans as impaired if, based on current information and events, it is probable that the Company will be unable to collect all amounts due according to the contractual terms of the loan agreement. For impaired loans still accruing interest, interest income is recognized according to the terms of the loan agreement. See Allowance for Credit Losses policy below with regard to reserves for impaired loans.

Commercial real estate loans are charged off when designated loss by the Banks regulators, when past due more than 180 days (unless well collateralized), or when deemed uncollectible by management. Home equity lines of credit and second mortgage loans are generally charged off after 120 days past due or after 60 days past due if the account is in bankruptcy. Past due and delinquency status is determined based on contractual terms.

ALLOWANCE FOR CREDIT LOSSES

The allowance for credit losses (the Allowance) is comprised of the Allowance for Loan Losses and a separate Liability for Credit Commitment Losses. The Allowance for Loan Losses is a reserve against funded loan amounts, while the Liability for Credit Commitment Losses relates to those amounts that Corus is committed to lend but for which funds have not yet been disbursed. The Allowance is available to absorb losses inherent in the loan portfolio. Increases to the Allowance result from provisions for credit losses that are charged to earnings and from recoveries of previously charged-off loans. Decreases to the Allowance result as loans, or portions thereof, are charged-off.

The Allowance for Loan Losses is based upon quarterly analyses. The methodology is designed to first provide for specific reserves associated with impaired loans. As defined by SFAS 114, a loan is impaired when, based on current information and events, it is probable that a creditor will be unable to collect both the interest payments and the principal payments of a loan due according to the contractual terms of the loan agreement.

CORUS BANKSHARES 2005 ANNUAL REPORT     15

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NOTES to CONSOLIDATED FINANCIAL STATEMENTS (continued)

Management primarily uses the loan rating system prescribed by the Office of the Comptroller of the Currency (the OCC) to select loans for impairment assessment. Loans determined to be impaired are segregated from the remainder of the portfolio and are subjected to a specific review in an effort to determine whether or not a specific reserve is necessary.

A general reserve is calculated for the remainder of the portfolio. The portfolio is first segmented into subcategories of like-kind loans. Corus will segment the loans as follows:

| | Commercial real estate   loans (which may be further broken down into, among other categories,   construction, non-construction and mezzanine)
|- | ----------------------------------------------------------------------------------------------------------------------------------------------
|  |                                                                                                                                               
| | Commercial loans                                                                                                                              
|  |                                                                                                                                               
| | Overdrafts                                                                                                                                    
|  |                                                                                                                                               
| | Residential loans                                                                                                                             
|  |                                                                                                                                               
| | Student/Other loans                                                                                                                           

The general reserve is calculated as a percentage (the Reserve Percentage) of the outstanding balance of each of the above-listed segments. The Reserve Percentage is based on a historic charge-off percentage (if a net recovery, then zero) adjusted by a Management Adjustment Factor (MAF). The MAF is based on the trends of various objective and subjective factors. These factors, which are not all weighted equally, may change over time as the portfolio changes. The factors considered include the level and direction of nonperforming and adversely rated loans, the overall breakdown of the portfolio (collateral type and location), and managements perception of the current state of the economy.

The process for estimating the Liability for Credit Commitment Losses closely follows the process outlined above for the Allowance for Loan Losses. The primary difference is that the Reserve Percentage is adjusted to account for the lower risk associated with unfunded amounts combined with the expected timing and likelihood of funding.

The assessment as to the adequacy of the Allowance is grounded by the assumption that historical experience is a good indicator of inherent losses. This assumption, while supported by guidance provided by the Financial Accounting Standards Board (FASB), the OCC, and the Securities and Exchange Commission, may not ultimately be correct. In that event, estimates of inherent losses may differ materially from actual results.

PREMISES AND EQUIPMENT

Premises and equipment are stated at cost, less accumulated depreciation. Depreciation on premises is computed primarily using the straight-line method over the estimated useful life. Depreciation on furniture and equipment is computed using accelerated methods. Expenditures for normal repairs and maintenance are charged to expense as incurred.

OTHER REAL ESTATE OWNED

Other real estate owned includes properties acquired through foreclosure. These properties are generally recorded at the lower of cost or estimated realizable value. Gains and losses from the sale or write-down of other real estate owned are included in other income. The net costs of maintaining these properties are included in operating expenses.

GOODWILL

Under Statement of Financial Accounting Standards No. 142, Goodwill and Other Intangible Assets, goodwill is subjected to an annual impairment test. The test consists of a two-step process whereby a determination is first made as to whether impairment exists, and then whether an adjustment is required.

16CORUS BANKSHARES 2005 ANNUAL REPORT

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DERIVATIVES

The Company enters into certain derivative transactions primarily as part of its overall interest rate risk management process. Interest rate derivatives may also be purchased as trading securities in anticipation of taking gains on short-term price movements. Statement of Financial Accounting Standards No. 133, Accounting for Derivative Instruments and Hedging Activities, as amended (SFAS 133), requires a company to recognize all derivative instruments at fair value on its balance sheet. The accounting for changes in fair value (i.e., gains or losses) of a derivative instrument depends on whether it has been designated and qualifies as part of a hedging relationship and further, on the type of hedging relationship. The Company formally documents all relationships between hedging instruments and hedged items, as well as its risk-management objective and strategy for undertaking each hedge transaction.

Derivative instruments designated in a hedge relationship to mitigate exposure to changes in the fair value of fixed-rate assets, liabilities, or firm commitments are considered fair value hedges under SFAS 133. Fair value hedges are accounted for by recording the fair value of the derivative instrument and the fair value of the hedged asset or liability on the balance sheet. The changes in the fair value of the derivatives and the hedged assets or liabilities are recorded in the income statement. The adjustment to the hedged asset or liability is included in the basis of the hedged item, while the fair value of the derivative is recorded as a freestanding asset or a liability. Interest income or expense associated with the derivatives is recorded as an offset to the related interest income or expense recorded on the hedged asset or liability.

Derivative instruments designated in a hedge relationship to mitigate exposure to variability in expected future cash flows, or other types of forecasted transactions, are considered cash flow hedges. Cash flow hedges are accounted for by recording the fair value of the derivative instrument on the balance sheet as either a freestanding asset or a liability, with a corresponding offset recorded in other comprehensive income within shareholders equity, net of taxes. Amounts are reclassified from other comprehensive income to the income statement in the period or periods the hedged transaction affects earnings.

Under both the fair value and cash flow hedge methods, any ineffective portions of the hedges are recognized immediately in income. For derivative instruments not designated as hedging instruments, the gain or loss is recognized in noninterest income as a part of securities gains/(losses), net.

STOCK-BASED EMPLOYEE COMPENSATION

Corus utilizes its stock to compensate employees under the 1990 Stock Option Plan and the 1999 Stock Option Plan (together, the Stock Option Plans) and the Commission Program for Commercial Loan Officers (the CLO Program). These plans are described more fully in Note 14 and in Managements Discussion and Analysis of Financial Condition and Results of Operations.

Effective January 1, 2003, Corus adopted the fair value recognition provisions of Statement of Financial Accounting Standards No. 123, Accounting for Stock-Based Compensation (SFAS 123). Corus elected to adopt SFAS 123 using the modified prospective method. Under the modified prospective method, the recognition of compensation cost beginning in 2003 is the same as what would have been recognized had the provisions of SFAS 123 been applied since the date of grant for all outstanding options. However, results for prior years have not been restated and therefore reflect the previous method of accounting for stock-based compensation under the recognition and measurement provisions of Accounting Principles Board Opinion No. 25, Accounting for Stock Issued to Employees (APB 25), and related Interpretations.

Under the fair-value method, compensation cost for stock-based compensation is recognized over the vesting period of the instrument based on the fair value as determined at the grant date. No adjustments to expense are recorded to reflect any changes in fair value subsequent to the grant date. Exercises, in general, result in no additional expense and compensation expense is never recognized for options forfeited prior to vesting.

CORUS BANKSHARES 2005 ANNUAL REPORT     17

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Table of Contents

NOTES to CONSOLIDATED FINANCIAL STATEMENTS (continued)

With regard to the Stock Option Plans, all stock options granted had an exercise price equal to the market value of the underlying common stock on the date of grant. The fair value of options granted was computed using the Black-Scholes valuation model. See Note 14 for a summary of stock option valuation assumptions.

RECLASSIFICATIONS

Certain prior year amounts have been reclassified to conform to the 2005 presentation.

|NOTE 2RECENT ACCOUNTING PRONOUNCEMENTS
|--------------------------------------
|                                      

SFAS 123 (REVISED 2004)  SHARE-BASED PAYMENT

In December 2004, the FASB issued Statement of Financial Accounting Standards No. 123 (revised 2004), Share-Based Payment (SFAS 123(R)), which is a revision of SFAS 123. SFAS 123(R) supersedes APB 25, and amends Statement of Financial Accounting Standards No. 95, Statement of Cash Flows. Generally, the approach in SFAS 123(R) is similar to the approach described in SFAS 123. However, SFAS 123(R) requires all share-based payments to employees, including grants of employee stock options, to be recognized in the income statement based on their fair values. Pro forma disclosure is no longer an alternative. The provisions of this statement are effective for the Company on January 1, 2006.

Corus adopted the fair-value-based method of accounting for share-based payments effective January 1, 2003, using the modified prospective method described in Statement of Financial Accounting Standards No. 148, Accounting for Stock-Based Compensation Transition and Disclosure. Currently, the Company uses the Black-Scholes formula to estimate the value of stock options granted to employees and expects to continue to use this acceptable option valuation model upon the required adoption of SFAS 123(R) on January 1, 2006. The Company does not anticipate that adoption of SFAS 123(R) will have a material impact on its results of operations or its financial position.

SFAS 154  ACCOUNTING CHANGES AND ERROR CORRECTIONS

In May 2005, the FASB issued Statement of Financial Accounting Standards No. 154, Accounting Changes and Error Corrections (SFAS 154), which supersedes APB Opinion No. 20, Accounting Changes and Statement of Financial Accounting Standards No. 3, Reporting Accounting Changes in Interim Financial Statements. SFAS 154 changes the requirements for the accounting for and reporting of changes in accounting principles. The statement requires the retroactive application to prior periods financial statements of changes in accounting principles, unless it is impracticable to determine either the period-specific effects or the cumulative effect of the change. SFAS 154 does not change the guidance for reporting the correction of an error in previously issued financial statements or the change in an accounting estimate. SFAS 154 is effective for accounting changes and corrections of errors made in
fiscal years beginning after December 15, 2005. The Company does not anticipate that adoption of SFAS 154 will have a material impact on its results of operations or its financial position.

18     CORUS BANKSHARES 2005 ANNUAL REPORT

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Table of Contents

|NOTE 3SECURITIES
|----------------
|                

The amortized cost, gross unrealized gains and losses, and fair value of securities were as follows:

|                             |  |                |           | GROSS   UNREALIZED |        |            | 
|---------------------------- |  | -------------- | --------- | ------------------ | ------ | ---------- | 
|                             |  | AMORTIZED
COST |           |                    |        | FAIR
VALUE | 
|DECEMBER 31, 2005            |  |                | GAINS     |                    | LOSSES |            | 
|                             | 
|(dollars in thousands)       |  |                |           |                    |        |            | 
|AVAILABLE-FOR-SALE:          |  |                |           |                    |        |            | 
|U.S. Government and agencies |  | $              | 3,234,257 |                    | $      |           | 
|Common stocks                |  |                | 110,586   |                    |        | 73,955     | 
|Other                        |  |                | 15,039    |                    |        | 572        | 
|                             | 
|Total                        |  | $              | 3,359,882 |                    | $      | 74,527     | 
|                             | 
|HELD-TO-MATURITY:            |  |                |           |                    |        |            | 
|Federal Reserve Bank stock   |  | $              | 14,468    |                    | $      |           | 
|Other                        |  |                | 2         |                    |        |           | 
|                             | 
|Total                        |  | $              | 14,470    |                    | $      |           | 
|                             | 
|                             |  |                |           |                    |        |            | 

|                             |  | AMORTIZED
COST |         | GROSS UNREALIZED |        | FAIR
VALUE | 
|---------------------------- |  | -------------- | ------- | ---------------- | ------ | ---------- | 
|                             |  |                |         |                  |       
|DECEMBER   31, 2004          |  |                | GAINS   |                  | LOSSES |            | 
|                             | 
|(dollars   in thousands)     |  |                |         |                  |        |            | 
|AVAILABLE-FOR-SALE:          |  |                |         |                  |        |            | 
|U.S. Government and agencies |  | $              | 427,868 |                  | $      | 23         | 
|Common stocks                |  |                | 128,620 |                  |        | 90,479     | 
|Other                        |  |                | 19,314  |                  |        | 535        | 
|                             | 
|Total                        |  | $              | 575,802 |                  | $      | 91,037     | 
|                             | 
|HELD-TO-MATURITY:            |  |                |         |                  |        |            | 
|Federal Reserve Bank stock   |  | $              | 11,649  |                  | $      |           | 
|State and municipal          |  |                | 600     |                  |        | 5          | 
|Other                        |  |                | 95      |                  |        | 4          | 
|                             | 
|Total                        |  | $              | 12,344  |                  | $      | 9          | 
|                             | 
|                             |  |                |         |                  |        |            | 

CORUS BANKSHARES 2005 ANNUAL REPORT     19

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Table of Contents

NOTES to CONSOLIDATED FINANCIAL STATEMENTS (continued)

The following tables present the aggregate amount of unrealized losses and the aggregate related fair values of investments with unrealized losses as of December 31, 2005 and 2004, that are not deemed to be other-than-temporarily impaired. The securities presented are grouped according to the time periods during which the investments have been in a continuous unrealized loss position.

|                             |  | LESS THAN   12 MONTHS |           | MORE THAN   12 MONTHS |   | TOTAL      | 
|---------------------------- |  | --------------------- | --------- | --------------------- | - | ---------- | 
|                             |  |                       |           |                       |   |            | 
|DECEMBER 31, 2005            |  | FAIR VALUE            |           | UNREALIZED    LOSSES  |   | FAIR VALUE | 
|                             | 
|(dollars   in thousands)     |  |                       |           |                       |   |            | 
|AVAILABLE-FOR-SALE:          |  |                       |           |                       |   |            | 
|U.S. Government and agencies |  | $                     | 3,119,683 |                       | $ | 5,295      | 
|                             | 
|Total                        |  | $                     | 3,119,683 |                       | $ | 5,295      | 
|                             | 

|                             |  | LESS THAN   12 MONTHS |         | MORE THAN   12 MONTHS |   | TOTAL      | 
|---------------------------- |  | --------------------- | ------- | --------------------- | - | ---------- | 
|                             |  |                       |         |                       |   |            | 
|DECEMBER 31, 2004            |  | FAIR VALUE            |         | UNREALIZED    LOSSES  |   | FAIR VALUE | 
|                             | 
|(dollars   in thousands)     |  |                       |         |                       |   |            | 
|AVAILABLE-FOR-SALE:          |  |                       |         |                       |   |            | 
|U.S. Government and agencies |  | $                     | 403,035 |                       | $ | 204        | 
|Other                        |  |                       | 19,020  |                       |   | 3          | 
|                             | 
|Total                        |  | $                     | 422,055 |                       | $ | 207        | 
|                             | 

The unrealized losses on the Companys investments in U.S. Government and agencies were caused by interest rate increases. The contractual terms of those investments do not permit the issuer to settle the securities at a price less than the amortized cost of the investment. In view of the fact that the Company has the ability and intent to hold those investments until a recovery of fair value, which may be maturity, the Company does not consider those investments to be other-than-temporarily impaired at December 31, 2005.

The scheduled maturities for securities were as follows:

|                                          |  | AVAILABLE-FOR-SALE |           | HELD-TO-MATURITY |  
|----------------------------------------- |  | ------------------ | --------- | ---------------- | -
|                                          |  |                    |           |                  |  
|DECEMBER   31, 2005                       |  | AMORTIZED    COST  |           | FAIR VALUE       |  
|                                          | 
|(dollars   in thousands)                  |  |                    |           |                  |  
|Due in:                                   |  |                    |           |                  |  
|One year or less                          |  | $                  | 3,234,257 |                  | $
|After ten years                           |  |                    |          |                  |  
|                                          | 
|Subtotal                                  |  |                    | 3,234,257 |                  |  
|Securities not due at a   single maturity |  |                    | 125,625   |                  |  
|                                          | 
|Total                                     |  | $                  | 3,359,882 |                  | $
|                                          | 

Gross gains realized from available-for-sale securities totaled $14.1 million, $31.6 million, and $10.1 million during 2005, 2004, and 2003, respectively. Gross realized losses from the sale of available-for-sale securities since 2003 are limited to a loss of $0.6 million recognized in 2005. Corus did, however, realize book losses in 2005 and 2003 of $0.9 million and $9.0 million, respectively, due to adjustments for an other than temporary decline in value, as defined by Statement of Financial Accounting Standards No. 115, Accounting for Certain Investments in Debt and Equity Securities. Please see Managements Discussion and Analysis of Financial Condition and Results of Operations for further discussion.

Securities having an aggregate carrying value of $22.0 million and $19.3 million at December 31, 2005 and 2004, respectively, were pledged as collateral related to derivative contracts, to secure public deposits and for other purposes.

20     CORUS BANKSHARES 2005 ANNUAL REPORT

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Table of Contents

|NOTE 4LOANS
|-----------
|           

Total loans, net of deferred loan fees, other discounts, and exit fees receivable of $44.5 million and $36.7 million at December 31, 2005 and 2004, respectively, were as follows:

|                                    |  | 2005 |           | 2004 |  
|----------------------------------- |  | ---- | --------- | ---- | -
|                                    | 
|(dollars   in thousands)            |  |      |           |      |  
|Commercial real estate:             |  |      |           |      |  
|Senior   construction               |  | $    | 2,157,955 |      | $
|Senior   non-construction           |  |      | 2,114,037 |      |  
|Mezzanine                           |  |      | 132,432   |      |  
|                                    | 
|Total   Commercial Real Estate      |  |      | 4,404,424 |      |  
|Commercial                          |  |      | 84,381    |      |  
|Residential real estate and   other |  |      | 35,706    |      |  
|                                    | 
|Total                               |  | $    | 4,524,511 |      | $
|                                    | 

In addition to the loan balances listed in the above table, Corus has loan commitments of $4.0 billion representing both unfunded loan balances and commitment letters issued. Please see Note 12 for additional details.

As of December 31, 2005, 87% of Corus outstanding commercial real estate loans were collateralized by condominium buildings in major metropolitan areas. Please see Managements Discussion and Analysis of Financial Condition and Results of Operations for a breakdown of loans by size, collateral type, and geographic distribution.

The Allowance for Credit Losses is comprised of the Allowance for Loan Losses and a separate Liability for Credit Commitment Losses. The Allowance for Loan Losses is a reserve against funded loan amounts, while the Liability for Credit Commitment Losses relates to those amounts that Corus is committed to lend but for which funds have not yet been disbursed. In the aggregate, the Allowance for Credit Losses had a balance of $44.7 million at December 31, 2005, which was comprised of a $39.7 million Allowance for Loan Losses and a $5.0 million Liability for Credit Commitment Losses.

In accordance with the results of Corus Allowance for Credit Losses analysis, the Company recorded a provision for credit losses of $6.0 million in 2005. The Allowance for Credit Losses analysis incorporates numerous quantitative measures including historical losses, loan growth, and credit quality, as well as various qualitative factors. In 2004, no provision for credit losses was necessary. Management believes this was appropriate given the results of managements analysis and the balance of the Allowance for Credit Losses at December 31, 2004. Additionally, in 2004, Corus reclassified $5.0 million of the Allowance for Loan Losses to the Liability for Credit Commitment Losses with no subsequent adjustments necessary.

Changes in the Allowance for Credit Losses were as follows:

|                            |  | 2005 |        | 2004 |   | 2003   |  
|--------------------------- |  | ---- | ------ | ---- | - | ------ | -
|                            | 
|(dollars   in thousands)    |  |      |        |      |   |        |  
|Balance at January
1        |  | $    | 37,882 |      | $ | 36,448 |  
|Provision for credit losses |  |      | 6,000  |      |   |       |  
|Charge-offs                 |  |      | (927   | )    |   | (665   | )
|Recoveries                  |  |      | 1,785  |      |   | 2,099  |  
|                            | 
|Balance at December 31      |  | $    | 44,740 |      | $ | 37,882 |  
|                            | 

CORUS BANKSHARES 2005 ANNUAL REPORT     21

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Table of Contents

NOTES to CONSOLIDATED FINANCIAL STATEMENTS (continued)

Disclosure with respect to impaired loans as of December 31, 2005 and 2004, respectively, is as follows:

|DECEMBER 31                                                     |  | 2005 |        | 2004 |  
|--------------------------------------------------------------- |  | ---- | ------ | ---- | -
|                                                                | 
|(dollars   in thousands)                                        |  |      |        |      |  
|Impaired loans                                                  |  | $    | 16,374 |      | $
|Amount specifically   reserved in the Allowance for Loan Losses |  |      | 667    |      |  
|Average impaired loans                                          |  |      | 30,918 |      |  
|Interest income recognized   on impaired loans during the year  |  |      | 2,035  |      |  
|                                                                | 

Nonaccrual loans totaled $73,000 and $76,000 as of December 31, 2005 and 2004, respectively. The interest forgone on these loans, net of cash receipts, was $5,562 and $4,300 for 2005 and 2004, respectively. Nonaccrual loan balances are included in the impaired loan amounts listed above. As of December 31, 2005 and 2004, loans past due 90 days or more totaled $0.5 million and $5.7 million, respectively.

|NOTE 5PREMISES AND EQUIPMENT
|----------------------------
|                            

Premises and equipment were as follows:

|DECEMBER 31                         |  | 2005 |         | 2004 |  
|----------------------------------- |  | ---- | ------- | ---- | -
|                                    | 
|(dollars   in thousands)            |  |      |         |      |  
|Land and improvements               |  | $    | 7,819   |      | $
|Buildings and improvements          |  |      | 28,970  |      |  
|Furniture and equipment             |  |      | 23,142  |      |  
|                                    | 
|Gross Premises and Equipment        |  |      | 59,931  |      |  
|Less accumulated   depreciation     |  |      | (33,492 | )    |  
|                                    | 
|Total Premises and   Equipment, Net |  | $    | 26,439  |      | $
|                                    | 

Two banking locations occupy offices under long-term operating lease agreements. Rent expense under these lease agreements totaled $414,000, $404,000, and $372,000 for the years ended December 31, 2005, 2004, and 2003, respectively.

Minimum fixed lease obligations, including taxes, insurance and other expenses, to the extent such costs are fixed by lease agreements, for leases in effect at December 31, 2005, were as follows:

|YEARS ENDING DECEMBER 31 | 
|------------------------ | 
|                         | 
|(dollars   in thousands) | 
|2006                     | 
|2007                     | 
|2008                     | 
|2009                     | 
|2010                     | 
|2011
and thereafter      | 
|                         | 
|Minimum payments         | 
|                         | 

22    CORUS BANKSHARES 2005 ANNUAL REPORT

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Table of Contents

|NOTE 6DEPOSITS
|--------------
|              

Interest-bearing deposits at December 31, 2005, include certificates of deposit (CDs) totaling $4.8 billion, of which $2.5 billion related to CDs in amounts of $100,000 or more. At December 31, 2004, CDs totaled $1.8 billion, of which $1.0 billion related to CDs in amounts of $100,000 or more. Interest expense on CDs of $100,000 or more totaled $67.2 million and $20.5 million in 2005 and 2004, respectively.

At December 31, 2005, the scheduled maturities of all certificates of deposit were as follows:

|YEARS ENDING DECEMBER 31 |  | BROKERED    CDS |         | RETAIL    CDS |   | TOTAL     | 
|------------------------ |  | --------------- | ------- | ------------- | - | --------- | 
|                         | 
|(dollars   in thousands) |  |                 |         |               |   |           | 
|2006                     |  | $               | 98,185  |               | $ | 4,399,366 | 
|2007                     |  |                 | 79,496  |               |   | 26,961    | 
|2008                     |  |                 | 93,605  |               |   | 8,666     | 
|2009                     |  |                 | 62,245  |               |   | 7,099     | 
|2010                     |  |                 | 55,438  |               |   | 2,438     | 
|2011
and thereafter      |  |                 |        |               |   | 9         | 
|                         | 
|Total                    |  | $               | 388,969 |               | $ | 4,444,539 | 
|                         | 

As of December 31, 2005 and 2004, overdraft demand deposits totaling $22.3 million and $33.4 million, respectively, were reclassified from deposits to loans.

|NOTE 7LONG-TERM DEBT
 SUBORDINATED DEBENTURES
|----------------------------------------------
|                                              

In 2005, Corus formed four additional wholly-owned unconsolidated finance subsidiaries (Trusts), for the sole purpose of issuing $100 million of Trust Preferred securities. The proceeds of the Trust Preferred securities, along with proceeds of $3.1 million from the issuance of common securities by the Trusts to Corus, were used to purchase $103.1 million of the Companys floating rate junior subordinated notes (Debentures).

The Debentures each mature 30 years from their respective issuance date, but are redeemable (at par) at Corus option at any time commencing on the fifth anniversary of their issuance (or upon the occurrence of certain other prescribed events). Interest payments on the Debentures are payable quarterly. So long as an event of default has not occurred (described further below), Corus may defer interest payments for up to 20 consecutive quarters. Events of default include failure to pay interest after 20 consecutive quarters of deferral (if such election is ever made), failure to pay all principal and interest at maturity, or filing bankruptcy.

If Corus were
to elect to defer interest on any of the Debentures, Corus would generally be
restricted from declaring or paying any dividends to common shareholders or
repurchasing its common stock. Additionally, Corus would not be permitted to
make any payments of principal or interest on, or to repay/redeem, any debt
securities that are of equal rank with (i.e., pari passu), or are junior to, the
Debentures. In other words, if Corus were to elect to defer interest payments on
any one of the Debentures, Corus would be required to defer all payments with
respect to all of its Debentures.

CORUS BANKSHARES 2005 ANNUAL REPORT     23

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Table of Contents

NOTES to CONSOLIDATED FINANCIAL STATEMENTS (continued)

Debentures outstanding totaled $358.3 million and $255.2 million as of December 31, 2005 and 2004, respectively. The scheduled maturities of the Debentures are $177.8 million in 2033, $77.3 million in 2034, $77.3 million in 2035, and $25.8 million in 2036. Interest and fees included in interest expense totaled $18.0 million, $9.4 million, and $1.8 million for the years ended December 31, 2005, 2004, and 2003, respectively.

The Debentures include interest rates ranging from LIBOR plus 1.33% to LIBOR plus 3.10%, resetting quarterly.

|NOTE 8OTHER
BORROWINGS
|----------------------
|                      

As of December 31, 2005, Corus had the right to borrow up to $100 million in a revolving line of credit agreement maturing on November 30, 2008. Interest is payable quarterly and accrues at a rate of LIBOR plus 140 basis points. In addition, a fee at an annual rate of 25 basis points of the average unused commitment is due quarterly.

Loan covenants require Corus to maintain prescribed levels of capital, limit the level of nonperforming loans relative to capital, and maintain a minimum ratio of the Allowance for Credit Losses (which includes both the Allowance for Loan Losses and the Liability for Credit Commitment Losses) to total loans. Corus is in compliance with all loan covenants as of December 31, 2005. The debt is secured by 100% of the common stock of the subsidiary bank.

During 2004, Corus had a similar arrangement for a revolving line of credit combined with a term note of $50 million. Interest was payable quarterly but accrued at a rate ranging from LIBOR plus 140 to 150 basis points. The unfunded fee of 25 basis points also applied.

Finally, other debt relates to periodic balances associated with Corus role of facilitating tax payments for the U.S. Treasury. Interest is paid at a rate of the Federal Funds Rate minus 25 basis points, and the debt is secured by a pledged security valued at approximately $5.5 million.

Outstanding balances and interest and fees for these notes were as follows:

|                         |  | BALANCE  OUTSTANDING  AT DECEMBER 31 |        | INTEREST   AND FEES FOR THE YEARS    ENDED DECEMBER 31 |  
|------------------------ |  | ------------------------------------ | ------ | ------------------------------------------------------ | -
|                         |  |                                      |        |                                                        |  
|                         |  | 2005                                 |        | 2004                                                   |  
|                         | 
|(dollars   in thousands) |  |                                      |        |                                                        |  
|Term note                |  | $                                    |       |                                                        | $
|Revolving note           |  |                                      | 19,150 |                                                        |  
|Other                    |  |                                      | 2,443  |                                                        |  
|                         | 
|Total                    |  | $                                    | 21,593 |                                                        | $
|                         | 

24     CORUS BANKSHARES 2005 ANNUAL REPORT

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Table of Contents

|NOTE 9INCOME
TAXES
|------------------
|                  

The components of income tax expense were as follows:

|YEARS ENDED DECEMBER 31                        |  | 2005 |        | 2004 |   | 2003   | 
|---------------------------------------------- |  | ---- | ------ | ---- | - | ------ | 
|                                               | 
|(dollars   in thousands)                       |  |      |        |      |   |        | 
|Current tax expense                            |  | $    | 77,067 |      | $ | 48,297 | 
|Deferred tax (benefit)   expense               |  |      | (4,011 | )    |   | 370    | 
|Deferred federal benefit    SFAS 123 adoption |  |      |       |      |   |       | 
|                                               | 
|Income Tax Provision                           |  | $    | 73,056 |      | $ | 48,667 | 
|                                               | 

A reconciliation of the statutory federal income tax rate to the effective rate is as follows:

|                                    |  | 2005 |      | 2004 |  | 2003 |  
|----------------------------------- |  | ---- | ---- | ---- |  | ---- | -
|                                    | 
|Statutory federal income tax   rate |  |      | 35.0 | %    |  | 35.0 | %
|Dividends received deduction        |  |      | (0.8 | )    |  | (1.1 | )
|State taxes                         |  |      | 0.5  |      |  |     |  
|Adjustment for tax exposure         |  |      |     |      |  | (0.8 | )
|Tax-exempt income                   |  |      |     |      |  |     |  
|Other, net                          |  |      |     |      |  | 0.1  |  
|                                    | 
|Effective Rate                      |  |      | 34.7 | %    |  | 33.2 | %
|                                    | 

Deferred taxes were recorded based upon differences between the financial statement and tax basis of assets and liabilities. The following deferred taxes were recorded:

|DECEMBER 31                                                            |  | 2005 |         | 2004 |  
|---------------------------------------------------------------------- |  | ---- | ------- | ---- | -
|                                                                       | 
|(dollars   in thousands)                                               |  |      |         |      |  
|DEFERRED   TAX ASSETS:                                                 |  |      |         |      |  
|Allowance   for loan losses and liability for credit commitment losses |  | $    | 15,339  |      | $
|Deferred   compensation                                                |  |      | 7,093   |      |  
|Stock   options                                                        |  |      | 2,764   |      |  
|Other   than temporary impairment                                      |  |      | 1,425   |      |  
|Other   deferred tax assets                                            |  |      | 188     |      |  
|                                                                       | 
|Gross   Deferred Tax Assets                                            |  |      | 26,809  |      |  
|                                                                       | 
|DEFERRED   TAX LIABILITIES:                                            |  |      |         |      |  
|Unrealized   securities gains                                          |  |      | (24,289 | )    |  
|Gains   on nonmonetary stock transactions                              |  |      | (6,286  | )    |  
|Investment   discount accretion                                        |  |      | (850    | )    |  
|Purchase   accounting adjustments                                      |  |      | (817    | )    |  
|Pension                                                                |  |      | (159    | )    |  
|Other   deferred tax liabilities                                       |  |      | (453    | )    |  
|                                                                       | 
|Gross   Deferred Tax Liabilities                                       |  |      | (32,854 | )    |  
|                                                                       | 
|Net Deferred Tax Liability                                             |  | $    | (6,045  | )    | $
|                                                                       | 

Management believes that the gross deferred tax asset of $26.8 million at December 31, 2005, could be realized through the carryback of taxable income against prior years.

CORUS BANKSHARES 2005 ANNUAL REPORT     25

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Table of Contents

NOTES to
CONSOLIDATED FINANCIAL STATEMENTS (continued)

|NOTE 10EMPLOYEE BENEFIT PLANS
|-----------------------------
|                             

Corus maintains a noncontributory defined benefit pension plan (Retirement Income Plan and Trust) and a defined contribution plan (Employees Savings Plan and Trust). Expense for each of the plans was as follows:

|YEARS ENDED DECEMBER 31             |  | 2005 |       | 2004 |   | 2003 | 
|----------------------------------- |  | ---- | ----- | ---- | - | ---- | 
|                                    | 
|(dollars   in thousands)            |  |      |       |      |   |      | 
|Retirement Income Plan and   Trust  |  | $    | 923   |      | $ | 613  | 
|Employees Savings Plan and   Trust |  |      | 194   |      |   | 199  | 
|                                    | 
|Total                               |  | $    | 1,117 |      | $ | 812  | 
|                                    | 

PENSION PLAN

Substantially all employees are eligible to participate in a noncontributory defined benefit plan after meeting age and service requirements. Pension benefits are based on length of service and compensation. Funding for the plan is based on actuarial cost methods. No contributions were made during the three years ended December 31, 2005. Pension plan assets are primarily invested in common stocks.

Net periodic benefit cost was comprised of the following:

|YEARS ENDED DECEMBER 31         |  | 2005 |       | 2004 |   | 2003   |  
|------------------------------- |  | ---- | ----- | ---- | - | ------ | -
|                                | 
|(dollars   in thousands)        |  |      |       |      |   |        |  
|Service cost                    |  | $    | 1,008 |      | $ | 787    |  
|Interest cost                   |  |      | 1,517 |      |   | 1,387  |  
|Actual gain on plan assets      |  |      | (924  | )    |   | (2,448 | )
|Net amortization and   deferral |  |      | (678  | )    |   | 887    |  
|                                | 
|Net Periodic Benefit Cost       |  | $    | 923   |      | $ | 613    |  
|                                | 

26     CORUS BANKSHARES 2005 ANNUAL REPORT

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Reconciliations of the plans projected benefit obligations and fair value of plan assets, as well as the funded status to the amounts recognized in Corus Consolidated Balance Sheets, follow:

CHANGE IN PROJECTED BENEFIT OBLIGATION

|                                    |  | 2005 |        | 2004 |  
|----------------------------------- |  | ---- | ------ | ---- | -
|                                    | 
|(dollars   in thousands)            |  |      |        |      |  
|Benefit obligation at   January
1   |  | $    | 24,278 |      | $
|Service cost                        |  |      | 1,008  |      |  
|Interest cost                       |  |      | 1,517  |      |  
|Actuarial loss                      |  |      | 3,346  |      |  
|Benefits paid                       |  |      | (943   | )    |  
|                                    | 
|Benefit Obligation at   December
31 |  | $    | 29,206 |      | $
|                                    | 

CHANGE IN FAIR VALUE OF PLAN ASSETS

|                                           |  | 2005 |        | 2004 |  
|------------------------------------------ |  | ---- | ------ | ---- | -
|                                           |  |      |        |      |  
|(dollars   in thousands)                   |  |      |        |      |  
|Fair value of plan assets at   January
1   |  | $    | 21,440 |      | $
|Actual gain on plan assets                 |  |      | 924    |      |  
|Benefits paid                              |  |      | (943   | )    |  
|                                           |  |      |        |      |  
|Fair Value of Plan Assets at   December
31 |  | $    | 21,421 |      | $
|                                           |  |      |        |      |  

FUNDED STATUS

|DECEMBER 31                 |  | 2005 |        | 2004 |  
|--------------------------- |  | ---- | ------ | ---- | -
|                            |  |      |        |      |  
|(dollars   in thousands)    |  |      |        |      |  
|Fair value of plan assets   |  | $    | 21,421 |      | $
|Less: Benefit obligation    |  |      | 29,206 |      |  
|                            |  |      |        |      |  
|Funded Status               |  |      | (7,785 | )    |  
|Unrecognized actuarial loss |  |      | 8,231  |      |  
|                            |  |      |        |      |  
|Prepaid Benefit Cost        |  | $    | 446    |      | $
|                            |  |      |        |      |  

The prepaid benefit cost represents the amount recognized in the Consolidated Balance Sheets as of December 31. The accumulated benefit obligation for the plan, which unlike the projected benefit obligation includes no assumption about increases in future compensation levels, was $20.9 million and $18.2 million at December 31, 2005 and 2004, respectively.

The following assumptions were used in accounting for the pension plan:

BENEFIT OBLIGATION

|DECEMBER 31                   |  | 2005 |      | 2004 | 
|----------------------------- |  | ---- | ---- | ---- | 
|                              |  |      |      |      | 
|Discount rate                 |  |      | 5.75 | %    | 
|Rate of compensation increase |  |      | 5.00 | %    | 
|                              |  |      |      |      | 

NET PERIODIC BENEFIT COST

|DECEMBER 31                      |  | 2005 |      | 2004 | 
|-------------------------------- |  | ---- | ---- | ---- | 
|                                 |  |      |      |      | 
|Discount rate                    |  |      | 6.25 | %    | 
|Expected return on plan   assets |  |      | 8.00 | %    | 
|Rate of compensation   increase  |  |      | 5.00 | %    | 
|                                 |  |      |      |      | 

CORUS BANKSHARES 2005 ANNUAL REPORT     27

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NOTES to
CONSOLIDATED FINANCIAL STATEMENTS (continued)

Plan assets are invested entirely in diversified equity securities, and it is managements plan to keep them invested in a diversified pool of equities going forward. Managements investment horizon is considered long term and, as such, long-term equity returns were studied using historical data over rolling 10-, 15-, and 20-year periods going back until the early 20th century. Based on its review of these historical returns, management determined that an expected long-term rate of return of 8.00% was reasonable.

PLAN ASSETS

Corus pension plan weighted average allocations at December 31, 2005 and 2004, by asset category are as follows:

|                    |  | PLAN   ASSETS AT
DECEMBER 31 |    
|------------------- |  | ---------------------------- | ---
|                    |  |                              |    
|ASSET CATEGORY      |  | 2005                         |    
|                    |  |                              |    
|Equity securities
. |  |                              | 98 
|Other               |  |                              | 2  
|                    |  |                              |    
|Total               |  |                              | 100
|                    |  |                              |    

The plan trustees intentions are to invest the majority of plan assets in a portfolio of diversified domestic equity securities with the remainder in cash to meet the immediate needs of the plan. The plan trustees believe that over the long term, which is thought to be the proper horizon for this asset, equity securities will outperform all other investment alternatives. This is based on a careful study of historical returns of various asset classes. The plan trustees are prepared to accept some volatility in specific annual returns during periods when equity securities under-perform the broader market. However, the plan trustees firmly believe that over the long run, such a strategy will perform better than a more diversified asset allocation strategy.

CONTRIBUTIONS

Corus expects to make no contributions to its pension plan in 2006.

EXPECTED FUTURE BENEFIT PAYMENTS

The following benefit payments are expected to be paid in each of the next five fiscal years and in the aggregate for the five fiscal years thereafter:

|YEARS ENDING DECEMBER 31 |  | PENSION BENEFIT PAYMENTS |       
|------------------------ |  | ------------------------ | ------
|                         |  |                          |       
|(dollars in thousands)   |  |                          |       
|2006                     |  | $                        | 1,037 
|2007                     |  |                          | 995   
|2008                     |  |                          | 991   
|2009                     |  |                          | 1,020 
|2010                     |  |                          | 1,108 
|2011  2015              |  |                          | 7,300 
|                         |  |                          |       
|Total                    |  | $                        | 12,451
|                         |  |                          |       

MEASUREMENT DATE

The measurement date for the 2005 fiscal year is December 31, 2005. Asset values are determined as of this date. Pension liabilities are valued at the beginning of the year and adjusted to December 31. The end of the year discount rate is used to determine the beginning of year liability.

SAVINGS PLAN

Most employees are eligible to become participants of Corus Employees Savings Plan and Trust. Corus matching contributions to this plan are discretionary. For the years ended December 31, 2005, 2004, and 2003, Corus matched 20% of participants contributions, up to a maximum of $1,500.

28     CORUS BANKSHARES 2005 ANNUAL REPORT

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|NOTE 11 | DERIVATIVES
|------- | -----------
|       

Statement of Financial Accounting Standards No. 133, Accounting for Derivative Instruments and Hedging Activities, as amended (SFAS 133), established accounting and reporting standards requiring that every derivative instrument be recorded in the balance sheet as either an asset or liability measured at its fair value. Special accounting for qualifying hedges (hedge accounting) allows a derivatives gains and losses to be either offset by the change in fair value of the hedged item or deferred through recognition in a component of other comprehensive income. Those derivatives that do not qualify for hedge accounting are required to be marked to market with the impact of the market adjustment recorded directly to income.

Corus utilizes derivatives primarily to hedge its interest rate risk. This is accomplished via interest rate swaps (to effectively convert fixed-rate loans and brokered CDs to floating rate) and interest rate basis swaps (to effectively convert LIBOR-based floating rate loans to Treasury-based floating-rate loans). Nearly all of the interest rate swaps qualified as fair value hedges and received hedge accounting treatment. The interest rate basis swaps were sold in April 2004.

Corus may also purchase and sell interest rate derivatives in anticipation of trading gains. The impact of market adjustments, as well as any gains or losses upon the sale of these swaps held for trading, is recorded directly into income.

The income statement impact and notional amounts related to both hedge and non-hedge derivatives were as follows:

DERIVATIVE GAIN/(LOSS)

|YEARS ENDED DECEMBER 31                       |  |  | INCOME STATEMENT   CLASSIFICATION |  | 2005 |    | 2004 |   | 2003  |  
|--------------------------------------------- |  |  | --------------------------------- |  | ---- | -- | ---- | - | ----- | -
|                                              |  |  |                                   |  |      |    |      |   |       |  
|(dollars in thousands)                        |  |  |                                   |  |      |    |      |   |       |  
|Fair value hedge   (fixed-to-floating swaps): |  |  |                                   |  |      |    |      |   |       |  
|Loan   hedge                                  |  |  | Interest Income                   |  | $    | 44 |      | $ | (10   | )
|Brokered   CD hedge(1)                        |  |  | Interest Expense                  |  |      |   |      |   |      |  
|                                              |  |  |                                   |  |      |    |      |   |       |  
|Total fair value hedge                        |  |  | .                                 |  |      | 44 |      |   | (10   | )
|                                              |  |  |                                   |  |      |    |      |   |       |  
|Non-hedge:                                    |  |  |                                   |  |      |    |      |   |       |  
|Fixed-to-floating   swaps  trading           |  |  | Noninterest Income                |  |      |   |      |   | 3,580 |  
|Fixed-to-floating   swaps  loans             |  |  | Noninterest Income                |  |      | 18 |      |   | 80    |  
|Basis   swaps                                 |  |  | Noninterest Income                |  |      |   |      |   | 1,446 |  
|                                              |  |  |                                   |  |      |    |      |   |       |  
|Total non-hedge                               |  |  |                                   |  |      | 18 |      |   | 5,106 |  
|                                              |  |  |                                   |  |      |    |      |   |       |  
|Total Derivative Gain                         |  |  |                                   |  | $    | 62 |      | $ | 5,096 |  
|                                              |  |  |                                   |  |      |    |      |   |       |  

NOTIONAL AMOUNTS OF DERIVATIVES

|DECEMBER 31                                   |  | 2005 |         | 2004 |   | 2003    | 
|--------------------------------------------- |  | ---- | ------- | ---- | - | ------- | 
|                                              |  |      |         |      |   |         | 
|(dollars in thousands)                        |  |      |         |      |   |         | 
|Fair value   hedge (fixed-to-floating swaps): |  |      |         |      |   |         | 
|Loan   hedge                                  |  | $    | 1,763   |      | $ | 3,539   | 
|Brokered   CD hedge(1)                        |  |      | 355,003 |      |   | 418,503 | 
|                                              |  |      |         |      |   |         | 
|Non-hedge:                                    |  |      |         |      |   |         | 
|Fixed-to-floating   swaps  loans             |  |      |        |      |   | 879     | 
|Basis   swaps                                 |  |      |        |      |   |        | 
|                                              |  |      |         |      |   |         | 

|(1) | These   swaps qualify for the shortcut method, as defined by SFAS 133. Corus does   not anticipate any income statement impact from the associated mark-to-market   adjustments.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

The counterparties to these instruments are major financial institutions with credit ratings of A or better.

CORUS BANKSHARES 2005 ANNUAL REPORT     29

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|NOTE 12 | FINANCIAL   INSTRUMENTS
|------- | -----------------------
|        |                        

In the normal course of business, Corus invests in various financial assets, incurs various financial liabilities and enters into agreements involving unrecognized financial instruments (consisting of standby letters of credit, commitment letters, and unused lines of credit). The fair value estimates of financial instruments presented below are not necessarily indicative of the amounts Corus might receive or pay in actual market transactions. Potential taxes and other transaction costs have also not been considered in estimating fair value. As some of Corus assets and liabilities are not considered financial instruments, the disclosures below do not reflect the fair value of Corus as a whole.

Corus had the following financial instruments:

|                                           |  | 2005              |           | 2004         |  
|------------------------------------------ |  | ----------------- | --------- | ------------ | -
|                                           |  |                   |           |              |  
|DECEMBER 31                                |  | CARRYING   AMOUNT |           | FAIR   VALUE |  
|                                           |  |                   |           |              |  
|(dollars in thousands)                     |  |                   |           |              |  
|FINANCIAL   ASSETS                         |  |                   |           |              |  
|Cash and cash equivalents                  |  | $                 | 458,351   |              | $
|Securities   available-for-sale            |  |                   | 3,428,168 |              |  
|Securities held-to-maturity                |  |                   | 14,470    |              |  
|Loans, net                                 |  |                   | 4,484,771 |              |  
|Accrued interest receivable                |  |                   | 37,798    |              |  
|                                           |  |                   |           |              |  
|FINANCIAL   LIABILITIES                    |  |                   |           |              |  
|Deposits without a stated   maturity       |  | $                 | 2,441,838 |              | $
|Certificates of deposit                    |  |                   | 4,833,508 |              |  
|Long-term debt    subordinated debentures |  |                   | 358,254   |              |  
|Federal funds purchased                    |  |                   | 41,200    |              |  
|Other borrowings                           |  |                   | 21,593    |              |  
|Accrued interest payable                   |  |                   | 30,672    |              |  
|Other liabilities                          |  |                   |          |              |  
|                                           |  |                   |           |              |  
|UNRECOGNIZED   FINANCIAL LIABILITIES       |  |                   |           |              |  
|Standby letters of credit                  |  | $                 | 40        |              | $
|Commitment letters                         |  |                   |          |              |  
|Unused lines of credit                     |  |                   |          |              |  
|                                           |  |                   |           |              |  

Cash and cash equivalentsare short-term in nature and, as such, fair value approximates carrying value.

Securitiesconsist primarily of common stocks and investments in U.S. government and agency notes. Fair values are based on quoted market prices, when available.

Loansare valued based on type of loan. The fair value of variable-rate loans that reprice frequently is assumed to approximate carrying value. The fair value of fixed-rate loans is based on the discounted amount of scheduled cash flows. The discount rate used is equal to the current rate of the appropriate index plus the average spread on the existing portfolio. Carrying value and fair value include the market value of both hedged loans and the related interest rate swaps. The total hedge ineffectiveness reflected in these balances was immaterial at December 31, 2005 and 2004. The fair values of interest rate swaps are based on either quoted market or dealer prices.

30     CORUS BANKSHARES 2005 ANNUAL REPORT

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Accrued interest receivableis short-term in nature and, as such, fair value approximates carrying value.

Deposits without a stated maturityare assumed to approximate carrying value.

Certificates of depositfair values are based on discounted contractual cash flows. Discount rates are selected using the rates that were offered at year-end.

Long-term debt  subordinated debenturesare floating rate and reprice quarterly. However, the spreads available on similar debt may fluctuate over time giving rise to changes in fair value.

Federal funds purchasedare short-term in nature and, as such, fair value approximates carrying value.

Other borrowingsare either short-term in nature or reprice quarterly and, as such, fair value approximates carrying value.

Accrued interest payableis short-term in nature and, as such, fair value approximates carrying value.

Other liabilitiesreflect the fair value of interest rate swaps that do not qualify for hedge accounting. As these are marked to market on a quarterly basis, carrying value equals fair value. The fair values of interest rate swaps are based on either quoted market or dealer prices.

Unrecognized financial liabilitiesare valued based on estimated fees currently charged to enter similar agreements, taking into account the remaining terms of the agreement and the present creditworthiness of the counterparties. Carrying value represents the associated deferred fees.

CORUS BANKSHARES 2005 ANNUAL REPORT     31

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NOTES to CONSOLIDATED FINANCIAL
STATEMENTS (continued)

The following is additional information related to the unrecognized financial liabilities:

|DECEMBER 31                                |  |   | 2005      |  |   | 2004      | 
|------------------------------------------ |  | - | --------- |  | - | --------- | 
|                                           |  |   |           |  |   |           | 
|(dollars in thousands)                     |  |   |           |  |   |           | 
|STANDBY   LETTERS OF CREDIT                |  |   |           |  |   |           | 
|Commercial   real estate:                  |  |   |           |  |   |           | 
|Senior   non-construction                  |  | $ | 8,495     |  | $ | 12,937    | 
|Senior   construction                      |  |   |          |  |   |          | 
|Mezzanine                                  |  |   |          |  |   |          | 
|Commercial                                 |  |   | 3,598     |  |   | 4,328     | 
|Residential   real estate and other        |  |   |          |  |   |          | 
|                                           |  |   |           |  |   |           | 
|Total Standby Letters of   Credit          |  |   | 12,093    |  |   | 17,265    | 
|                                           |  |   |           |  |   |           | 
|COMMITMENT   LETTERS OUTSTANDING           |  |   |           |  |   |           | 
|Commercial   real estate:                  |  |   |           |  |   |           | 
|Senior   non-construction                  |  |   | 65,900    |  |   | 35,500    | 
|Senior   construction                      |  |   | 333,972   |  |   | 52,500    | 
|Mezzanine                                  |  |   |          |  |   |          | 
|Commercial                                 |  |   |          |  |   |          | 
|Residential   real estate and other        |  |   |          |  |   |          | 
|                                           |  |   |           |  |   |           | 
|Total Commitment Letters                   |  |   | 399,872   |  |   | 88,000    | 
|                                           |  |   |           |  |   |           | 
|UNUSED   COMMITMENTS UNDER LINES OF CREDIT |  |   |           |  |   |           | 
|Commercial   real estate:                  |  |   |           |  |   |           | 
|Senior   non-construction                  |  |   | 209,339   |  |   | 116,540   | 
|Senior   construction                      |  |   | 3,297,374 |  |   | 2,427,228 | 
|Mezzanine                                  |  |   | 20,227    |  |   | 31,751    | 
|Commercial                                 |  |   | 7,001     |  |   | 12,642    | 
|Residential   real estate and other        |  |   | 9,086     |  |   | 9,922     | 
|                                           |  |   |           |  |   |           | 
|Total Unused Lines of Credit               |  |   | 3,543,027 |  |   | 2,598,083 | 
|                                           |  |   |           |  |   |           | 
|TOTAL   COMMITMENTS                        |  |   |           |  |   |           | 
|Commercial   real estate:                  |  |   |           |  |   |           | 
|Senior   non-construction                  |  |   | 283,734   |  |   | 164,977   | 
|Senior   construction                      |  |   | 3,631,346 |  |   | 2,479,728 | 
|Mezzanine                                  |  |   | 20,227    |  |   | 31,751    | 
|Commercial                                 |  |   | 10,599    |  |   | 16,970    | 
|Residential   real estate and other        |  |   | 9,086     |  |   | 9,922     | 
|                                           |  |   |           |  |   |           | 
|Total Commitments   Outstanding            |  | $ | 3,954,992 |  | $ | 2,703,348 | 
|                                           |  |   |           |  |   |           | 

32     CORUS BANKSHARES 2005 ANNUAL REPORT

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|NOTE 13 | LEGAL AND REGULATORY PROCEEDINGS
|------- | --------------------------------
|        |                                 

Corus is involved in various legal and regulatory proceedings involving matters that arose in the ordinary course of business. The consequences of these proceedings are not presently determinable but, in the opinion of management, these proceedings will not have a material effect on the results of operations, financial position, liquidity, or capital resources.

|NOTE 14 | SHAREHOLDERS EQUITY
|------- | --------------------
|        |                     

REGULATORY CAPITAL AND DIVIDEND RESTRICTIONS

Corus and its subsidiary bank are required to maintain certain capital ratios. Failure to maintain these ratios would severely limit their ability to pay dividends, support growth, and repurchase shares and would also increase the amount of FDIC insurance premiums. At December 31, 2005 and 2004, Corus and its subsidiary bank were categorized as well capitalized. Corus capital category is determined solely for the purpose of applying Prompt Corrective Action (PCA) and that capital category may not constitute an accurate representation of Corus overall financial condition or prospects. The PCA provisions of the FDIC Improvement Act of 1991 give banking regulators the legal authority to reduce the capital classification of a bank below what the numerical capital ratios would otherwise indicate. Please refer to the Liquidity and Capital Resources section of Managements Discussion and Analysis of Financial Condition and Results of
Operations for a further discussion.

There have been no events since December 31, 2005, that management believes would have changed that category. The minimum ratios required to be well capitalized as well as Corus and its subsidiary banks actual regulatory capital and ratios were as follows:

REGULATORY CAPITAL AND RATIOS

|                                      |  | TIER 1   LEVERAGE |         | TIER I   RISK-BASED CAPITAL |  | TOTAL   RISK-BASED CAPITAL |  
|------------------------------------- |  | ----------------- | ------- | --------------------------- |  | -------------------------- | -
|                                      |  |                   |         |                             |  |                            |  
|                                      |  | AMOUNT            |         | RATIO                       |  | AMOUNT                     |  
|                                      |  |                   |         |                             |  |                            |  
|(dollars in thousands)                |  |                   |         |                             |  |                            |  
|Minimum ratios for   well-capitalized |  |                   |         |                             |  | 5.0                        | %
|December
31, 2005:                    |  |                   |         |                             |  |                            |  
|Corus   Bankshares, Inc.              |  | $                 | 855,006 |                             |  | 10.7                       | %
|Subsidiary   bank                     |  |                   | 870,514 |                             |  | 11.1                       |  
|December
31, 2004:                    |  |                   |         |                             |  |                            |  
|Corus   Bankshares, Inc.              |  | $                 | 716,891 |                             |  | 15.7                       | %
|Subsidiary   bank                     |  |                   | 662,138 |                             |  | 14.9                       |  
|                                      |  |                   |         |                             |  |                            |  

The payment of dividends to Corus by its subsidiary bank is subject to federal regulatory limitations. National banks are generally allowed to pay dividends to the extent of net income for the current and prior two years, without regulatory approval. The payment of dividends by any bank may also be affected by other factors, such as the maintenance of adequate capital, as discussed above. At December 31, 2005, the total amount of the subsidiary banks retained earnings available for dividends without prior regulatory approval and maintaining well-capitalized status was $180.7 million.

CORUS BANKSHARES 2005 ANNUAL REPORT     33

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NOTES to CONSOLIDATED FINANCIAL
STATEMENTS (continued)

EQUITY COMPENSATION PLANS

Stock Option PlansOptions to purchase Corus common stock have been
granted to employees under the 1990 Stock Option Plan and the 1999 Stock Option
Plan (together, the Stock Option Plans) at prices equal to the fair
market value of the underlying stock on the dates the options were granted. The
options vest 20% per year, over a five-year period, and expire in 10
years. At December 31, 2005, there were 291,150 shares available for grant.

Changes in stock options outstanding were as follows:

STOCK OPTIONS

|                                |  | 2005               |       | 2004                               |   | 2003               | 
|------------------------------- |  | ------------------ | ----- | ---------------------------------- | - | ------------------ | 
|                                |  |                    |       |                                    |   |                    | 
|YEARS ENDED DECEMBER 31         |  | NUMBER   OF SHARES |       | WEIGHTED   AVERAGE   EXERCISEPRICE |   | NUMBER   OF SHARES | 
|                                |  |                    |       |                                    |   |                    | 
|(number of shares in thousands) |  |                    |       |                                    |   |                    | 
|Beginning options   outstanding |  |                    | 1,444 |                                    | $ | 21.05              | 
|Grants                          |  |                    | 150   |                                    |   | 48.50              | 
|Exercises/Settlements           |  |                    | (103  | )                                  |   | 18.06              | 
|Forfeitures/Expirations         |  |                    | (12   | )                                  |   | 33.94              | 
|                                |  |                    |       |                                    |   |                    | 
|Ending Options Outstanding      |  |                    | 1,479 |                                    | $ | 23.93              | 
|                                |  |                    |       |                                    |   |                    | 
|Exercisable at December
31      |  |                    | 957   |                                    | $ | 18.56              | 
|                                |  |                    |       |                                    |   |                    | 

The following table summarizes information about stock options outstanding at December 31, 2005.

|                                 |  | OPTIONS OUTSTANDING                |       | OPTIONS EXERCISABLE                                 | 
|-------------------------------- |  | ---------------------------------- | ----- | --------------------------------------------------- | 
|                                 |  |                                    |       |                                                     | 
|RANGE OF   EXERCISE PRICES       |  | NUMBER   OUTSTANDING   AT 12/31/05 |       | WEIGHTED   AVERAGE   REMAINING   CONTRACTUAL   LIFE | 
|                                 |  |                                    |       |                                                     | 
|(number of options in thousands) |  |                                    |       |                                                     | 
|$12
to
$17                       |  |                                    | 582   |                                                     | 
|$18
to
$25                       |  |                                    | 592   |                                                     | 
|$38
to
$49                       |  |                                    | 305   |                                                     | 
|                                 |  |                                    |       |                                                     | 
|Total                            |  |                                    | 1,479 |                                                     | 
|                                 |  |                                    |       |                                                     | 

The fair value of options granted was computed using the Black-Scholes valuation model using the following assumptions:

|GRANT DATE               |  | 4/8/05 |            | 7/19/04 |   | 4/30/04    |   | 4/10/03 |           
|------------------------ |  | ------ | ---------- | ------- | - | ---------- | - | ------- | ----------
|                         |  |        |            |         |   |            |   |         |           
|Risk-free rate           |  |        | 4.70       | %       |   | 4.68       | % |         | 4.85      
|Expected life            |  |        | 10   years |         |   | 10   years |   |         | 10   years
|Expected volatility      |  |        | 26.60      | %       |   | 27.20      | % |         | 27.30     
|Expected dividend yields |  |        | 2.89       | %       |   | 3.15       | % |         | 3.27      
|Fair value (1)           |  | $      | 13.85      |         | $ | 10.92      |   | $       | 10.48     
|                         |  |        |            |         |   |            |   |         |           

|(1) | All   amounts have been restated to reflect a 100% stock dividend on 12/15/03.
|--- | ------------------------------------------------------------------------------

34     CORUS BANKSHARES 2005 ANNUAL REPORT

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Commission Program for Commercial Loan OfficersCorus maintains a Commission Program for Commercial Loan Officers (the CLO Program) of which a portion of the commissions earned is held back, some of which may be in Corus common stock. Holdbacks in stock are initially recorded as additional surplus. Upon issuance, the par value of the stock is reclassified to common stock. CLO Program stock holdbacks in 2005 totaled $1.7 million.

Pursuant to the CLO Program, Corus will periodically release previously held back amounts. In 2005, Corus issued 60,216 common shares to certain commercial loan Officers. The release resulted in an incremental tax benefit to Corus of $0.8 million, recorded as additional surplus in accordance with SFAS 123.

As of December 31, 2005 and 2004, surplus included $13.2 million and $12.8 million, respectively, of commissions held back in Corus common stock. Commissions held back in other than Corus common stock were valued at $6.8 million and $5.3 million at December 31, 2005 and 2004, respectively, and are included in accrued interest payable and other liabilities.

|NOTE 15 | NET   INCOME PER SHARE
|------- | ----------------------
|        |                       

Net income per share was calculated as follows:

|YEARS ENDED DECEMBER 31                               |  |   | 2005    |  |   | 2004   |  |   | 2003   | 
|----------------------------------------------------- |  | - | ------- |  | - | ------ |  | - | ------ | 
|                                                      |  |   |         |  |   |        |  |   |        | 
|(in thousands, except per share data)                 |  |   |         |  |   |        |  |   |        | 
|Denominator for basic   earnings per share:           |  |   |         |  |   |        |  |   |        | 
|Average   common shares outstanding                   |  |   | 27,844  |  |   | 27,896 |  |   | 28,102 | 
|Dilutive common stock   options                       |  |   | 1,011   |  |   | 922    |  |   | 601    | 
|                                                      |  |   |         |  |   |        |  |   |        | 
|Denominator for Diluted   Earnings Per Share          |  |   | 28,855  |  |   | 28,818 |  |   | 28,703 | 
|                                                      |  |   |         |  |   |        |  |   |        | 
|Numerator: Net income   attributable to common shares |  | $ | 137,229 |  | $ | 97,939 |  | $ | 58,410 | 
|                                                      |  |   |         |  |   |        |  |   |        | 
|Net income per share:                                 |  |   |         |  |   |        |  |   |        | 
|Basic                                                 |  | $ | 4.93    |  | $ | 3.51   |  | $ | 2.08   | 
|Diluted                                               |  |   | 4.76    |  |   | 3.40   |  |   | 2.04   | 
|                                                      |  |   |         |  |   |        |  |   |        | 

CORUS BANKSHARES 2005 ANNUAL REPORT     35

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|NOTE 16 | RELATED PARTY TRANSACTIONS
|------- | --------------------------
|       

In 2005, a letter of credit totaling $0.7 million was issued to a director of Corus. No funds were ever drawn and the letter of credit was canceled prior to December 31, 2005. The letter of credit was made on substantially the same terms as those prevailing at the time for comparable transactions with other customers. In the opinion of management, the letter of credit did not involve more than the normal risk of collection or possess other favorable terms.

Separately, during 2005, Edward W. Glickman, a 10% beneficial owner of the Company, Robert J. Glickman, President and CEO of the Company and Joseph C. Glickman, Chairman of the Board of Directors of Company, participated in certain loans originated by Corus. These participations resulted from situations where Corus, due to legal lending limit restrictions and holding company participation policy limits, required an outside partys participation in order to close the loans. As an accommodation to Corus, the Glickmans agreed to participate in the loans.

The participation details were as follows:

|                       |  | TOTAL COMMITMENT
AS OF DECEMBER 31, |        | FEES AND INTEREST   PAID TO PARTICIPANT IN |  
|---------------------- |  | ----------------------------------- | ------ | ------------------------------------------ | -
|                       |  |                                     |        |                                            |  
|PARTICIPANT            |  |                                     | 2005   |                                            |  
|                       |  |                                     |        |                                            |  
|(dollars in thousands) |  |                                     |        |                                            |  
|Edward W. Glickman     |  | $                                   | 10,005 |                                            | $
|Robert J. Glickman     |  |                                     | 17,838 | (1)                                        |  
|Joseph C. Glickman     |  |                                     |       |                                            |  
|                       |  |                                     |        |                                            |  

|(1) | As of   December 31, 2005, R.J. Glickman was committed to participate in the loan but   the loan did not close until January, 2006, at which point $178,000 in fees   were earned.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Under the participation agreements, the participants are required to fund their committed amounts at the same time and in proportion to the amount committed by Corus. The following table provides details regarding the actual amounts funded by each participant:

|                       |  | FUNDED AMOUNT   AS OF DECEMBER 31, |       | MAXIMUM   OUTSTANDING DURING |  
|---------------------- |  | ---------------------------------- | ----- | ---------------------------- | -
|                       |  |                                    |       |                              |  
|PARTICIPANT            |  | 2005                               |       | 2004                         |  
|                       |  |                                    |       |                              |  
|(dollars in thousands) |  |                                    |       |                              |  
|Edward W. Glickman     |  | $                                  | 2,340 |                              | $
|Robert J. Glickman     |  |                                    |      |                              |  
|Joseph C. Glickman     |  |                                    |      |                              |  
|                       |  |                                    |       |                              |  

In addition, the participants receive interest based on the same terms as those applicable to Corus and are subject to the same credit risks. No interest is earned on unfunded commitments.

36     CORUS BANKSHARES 2005 ANNUAL REPORT

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|NOTE 17 | PARENT COMPANY FINANCIAL STATEMENTS
|------- | -----------------------------------
|        |                                    

Corus condensed parent company financial statements were as follows:

CONDENSED BALANCE SHEETS

|DECEMBER 31                                    |  | 2005 |           | 2004 |  
|---------------------------------------------- |  | ---- | --------- | ---- | -
|                                               |  |      |           |      |  
|(dollars in thousands)                         |  |      |           |      |  
|ASSETS:                                        |  |      |           |      |  
|Cash                                           |  | $    | 18,935    |      | $
|Available-for-sale   securities, at fair value |  |      | 189,399   |      |  
|Investment   in subsidiaries                   |  |      | 881,770   |      |  
|Loans,   net of unearned income                |  |      | 19,675    |      |  
|Other   assets                                 |  |      | 2,210     |      |  
|                                               |  |      |           |      |  
|Total Assets                                   |  | $    | 1,111,989 |      | $
|                                               |  |      |           |      |  
|LIABILITIES   AND SHAREHOLDERS EQUITY:        |  |      |           |      |  
|Long-term   debt  subordinated debentures     |  | $    | 358,254   |      | $
|Other   borrowings                             |  |      | 19,150    |      |  
|Other   liabilities                            |  |      | 44,810    |      |  
|Shareholders   equity                         |  |      | 689,775   |      |  
|                                               |  |      |           |      |  
|Total Liabilities and   Shareholders
Equity   |  | $    | 1,111,989 |      | $
|                                               |  |      |           |      |  

CONDENSED STATEMENTS OF INCOME

|YEARS ENDED DECEMBER 31                                                           |  | 2005 |         | 2004 |   | 2003   | 
|--------------------------------------------------------------------------------- |  | ---- | ------- | ---- | - | ------ | 
|                                                                                  |  |      |         |      |   |        | 
|(dollars in thousands, except per share   data)                                   |  |      |         |      |   |        | 
|INCOME:                                                                           |  |      |         |      |   |        | 
|Dividends   from bank subsidiary                                                  |  | $    | 20,700  |      | $ | 32,500 | 
|Interest,   loan fees, and dividend income                                        |  |      | 9,662   |      |   | 6,824  | 
|Securities   gains/(losses), net                                                  |  |      | 12,544  |      |   | 31,582 | 
|Other   income                                                                    |  |      |        |      |   | 47     | 
|                                                                                  |  |      |         |      |   |        | 
|Total   Income                                                                    |  |      | 42,906  |      |   | 70,953 | 
|                                                                                  |  |      |         |      |   |        | 
|EXPENSE:                                                                          |  |      |         |      |   |        | 
|Interest   expense                                                                |  |      | 18,750  |      |   | 10,175 | 
|Other   expenses                                                                  |  |      | 1,354   |      |   | 1,554  | 
|                                                                                  |  |      |         |      |   |        | 
|Total   Expense                                                                   |  |      | 20,104  |      |   | 11,729 | 
|                                                                                  |  |      |         |      |   |        | 
|Income   Before Income Taxes and Equity in Undistributed Net Income of Subsidiary |  |      | 22,802  |      |   | 59,224 | 
|Income   tax (benefit) expense                                                    |  |      | (907    | )    |   | 7,988  | 
|                                                                                  |  |      |         |      |   |        | 
|Income   Before Equity in Undistributed Net Income of Subsidiary                  |  |      | 23,709  |      |   | 51,236 | 
|Equity   in undistributed net income of bank subsidiary                           |  |      | 113,520 |      |   | 46,703 | 
|                                                                                  |  |      |         |      |   |        | 
|Net Income                                                                        |  | $    | 137,229 |      | $ | 97,939 | 
|                                                                                  |  |      |         |      |   |        | 
|Net income per share:                                                             |  |      |         |      |   |        | 
|Basic                                                                             |  | $    | 4.93    |      | $ | 3.51   | 
|Diluted                                                                           |  |      | 4.76    |      |   | 3.40   | 
|                                                                                  |  |      |         |      |   |        | 

CORUS BANKSHARES 2005 ANNUAL REPORT     37

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NOTES to CONSOLIDATED FINANCIAL
STATEMENTS (continued)

CONDENSED STATEMENTS OF CASH FLOWS

|YEARS ENDED DECEMBER 31                                                             |  | 2005 |          | 2004 |   | 2003    |  
|----------------------------------------------------------------------------------- |  | ---- | -------- | ---- | - | ------- | -
|                                                                                    |  |      |          |      |   |         |  
|(dollars in thousands)                                                              |  |      |          |      |   |         |  
|CASH FLOWS   FROM OPERATING ACTIVITIES:                                             |  |      |          |      |   |         |  
|Net income                                                                          |  | $    | 137,229  |      | $ | 97,939  |  
|Adjustments to reconcile net   income to net cash provided by operating activities: |  |      |          |      |   |         |  
|Depreciation                                                                        |  |      | 3        |      |   | 5       |  
|Securities   (gains)/losses, net                                                    |  |      | (12,544  | )    |   | (31,582 | )
|Deferred   income tax (benefit) expense                                             |  |      | (1,060   | )    |   | 7,711   |  
|(Increase)   decrease in other assets                                               |  |      | (506     | )    |   | 14,570  |  
|(Decrease)   increase in other liabilities                                          |  |      | (248     | )    |   | 4,792   |  
|Equity   in undistributed net income of bank subsidiary                             |  |      | (113,520 | )    |   | (46,703 | )
|                                                                                    |  |      |          |      |   |         |  
|Net   Cash Provided by Operating Activities                                         |  |      | 9,354    |      |   | 46,732  |  
|                                                                                    |  |      |          |      |   |         |  
|CASH FLOWS   FROM INVESTING ACTIVITIES:                                             |  |      |          |      |   |         |  
|Proceeds   from sales of available-for-sale securities                              |  |      | 35,241   |      |   | 15,079  |  
|Purchases   of available-for-sale securities                                        |  |      | (4,295   | )    |   | (21,109 | )
|Purchases   of premises and equipment                                               |  |      |         |      |   |        |  
|Loan   participations funded, net                                                   |  |      | (8,973   | )    |   | (10,702 | )
|Capital   infusion to subsidiary bank                                               |  |      | (93,000  | )    |   | (42,000 | )
|                                                                                    |  |      |          |      |   |         |  
|Net   Cash Used in Investing Activities                                             |  |      | (71,027  | )    |   | (58,732 | )
|                                                                                    |  |      |          |      |   |         |  
|CASH FLOWS   FROM FINANCING ACTIVITIES:                                             |  |      |          |      |   |         |  
|Net   proceeds from issuance of long-term debt  subordinated debentures            |  |      | 100,000  |      |   | 75,000  |  
|Repayment   of debt                                                                 |  |      |         |      |   | (35,000 | )
|Increase   (decrease) in other borrowings, net                                      |  |      | 13,650   |      |   | 5,500   |  
|Stock   option exercises/settlements                                                |  |      | 1,806    |      |   | 791     |  
|Equity   increase from subsidiary equity compensation plans                         |  |      | 3,427    |      |   | 5,185   |  
|Retirements   of common shares                                                      |  |      | (1,748   | )    |   | (10,821 | )
|Cash   dividends paid on common shares                                              |  |      | (37,921  | )    |   | (33,140 | )
|                                                                                    |  |      |          |      |   |         |  
|Net   Cash Provided by Financing Activities                                         |  |      | 79,214   |      |   | 7,515   |  
|                                                                                    |  |      |          |      |   |         |  
|Net Increase (Decrease) in   Cash and Cash Equivalents                              |  |      | 17,541   |      |   | (4,485  | )
|Cash and cash equivalents at   beginning of year                                    |  |      | 1,394    |      |   | 5,879   |  
|                                                                                    |  |      |          |      |   |         |  
|Cash and Cash Equivalents at   End of Year                                          |  | $    | 18,935   |      | $ | 1,394   |  
|                                                                                    |  |      |          |      |   |         |  

38     CORUS BANKSHARES 2005 ANNUAL REPORT

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|NOTE 18 | QUARTERLY FINANCIAL DATA (UNAUDITED)
|------- | ------------------------------------
|        |                                     

The following is a summary of quarterly financial information for the years ended December 31, 2005 and 2004:

|                                                               |  | YEAR ENDED DECEMBER 31, 2005 |         | YEAR ENDED DECEMBER 31, 2004 |  
|-------------------------------------------------------------- |  | ---------------------------- | ------- | ---------------------------- | -
|                                                               |  |                              |         |                              |  
|                                                               |  | FOURTH   QUARTER             |         | THIRD   QUARTER              |  
|                                                               |  |                              |         |                              |  
|(dollars in thousands, except per share data)                  |  |                              |         |                              |  
|Interest, loan fees, and   dividend income                     |  | $                            | 144,055 |                              | $
|Interest expense                                               |  |                              | 70,032  |                              |  
|                                                               |  |                              |         |                              |  
|Net   Interest Income                                          |  |                              | 74,023  |                              |  
|Provision for credit losses                                    |  |                              | (3,000  | )                            |  
|                                                               |  |                              |         |                              |  
|Net   Interest Income After Provision for Credit Losses        |  |                              | 71,023  |                              |  
|Noninterest income,   excluding securities gains/(losses), net |  |                              | 3,411   |                              |  
|Securities gains/(losses),   net                               |  |                              | 16      |                              |  
|Noninterest expense                                            |  |                              | 16,637  |                              |  
|                                                               |  |                              |         |                              |  
|Income   Before Income Taxes                                   |  |                              | 57,813  |                              |  
|Income tax expense                                             |  |                              | 19,720  |                              |  
|                                                               |  |                              |         |                              |  
|Net Income                                                     |  | $                            | 38,093  |                              | $
|                                                               |  |                              |         |                              |  
|Net income per share:                                          |  |                              |         |                              |  
|Basic                                                          |  | $                            | 1.37    |                              | $
|Diluted                                                        |  |                              | 1.32    |                              |  
|                                                               |  |                              |         |                              |  

COMMON STOCK MARKET INFORMATION AND DIVIDEND HIGHLIGHTS (UNAUDITED)

|                        |  | YEAR ENDED DECEMBER 31, 2005 |       | YEAR ENDED DECEMBER 31, 2004 |  
|----------------------- |  | ---------------------------- | ----- | ---------------------------- | -
|                        |  |                              |       |                              |  
|                        |  | FOURTH
        QUARTER       |       | THIRD
        QUARTER        |  
|                        |  |                              |       |                              |  
|Stock price range       |  |                              |       |                              |  
|High                    |  | $                            | 60.23 |                              | $
|Low                     |  |                              | 48.23 |                              |  
|Close                   |  |                              | 56.27 |                              |  
|Cash dividends declared |  |                              | 0.350 |                              |  
|                        |  |                              |       |                              |  

Corus common stock is a NASDAQ National Market Issue trading under the ticker symbol CORS.

CORUS BANKSHARES 2005 ANNUAL REPORT     39

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REPORT ofINDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors and Shareholders of Corus Bankshares, Inc.

We have audited the accompanying consolidated balance sheets of Corus Bankshares, Inc. and subsidiary as of December 31, 2005 and 2004, and the related consolidated statements of income, changes in shareholders equity and cash flows for each of the three years in the period ended December 31, 2005. These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of Corus Bankshares, Inc. and subsidiary at December 31, 2005 and 2004, and the consolidated results of their operations and their cash flows for each of the three years in the period ended December 31, 2005, in conformity with U.S. generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the effectiveness of Corus Bankshares, Inc.s internal control over financial reporting as of December 31, 2005, based on criteria established in Internal Control  Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 24, 2006, expressed an unqualified opinion thereon.

Message

Chicago, Illinois

February 24, 2006

40     CORUS BANKSHARES 2005 ANNUAL REPORT

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REPORTof  INDEPENDENT REGISTERED PUBLIC
ACCOUNTING FIRM

The Board of Directors and Shareholders of Corus Bankshares, Inc.

We have audited managements assessment, included in the accompanying Managements Report on Internal Control over Financial Reporting, that Corus Bankshares, Inc. maintained effective internal control over financial reporting as of December 31, 2005, based on criteria established in Internal Control  Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (the COSO criteria). Corus Bankshares, Inc.s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting. Our responsibility is to express an opinion on managements assessment and an opinion on the effectiveness of the companys internal control over financial reporting based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, evaluating managements assessment, testing and evaluating the design and operating effectiveness of internal control, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

A companys internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A companys internal control over financial reporting includes those policies and procedures that 1)pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; 2)provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and 3)provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the companys assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

In our opinion, managements assessment that Corus Bankshares, Inc. maintained effective internal control over financial reporting as of December 31, 2005, is fairly stated, in all material respects, based on the COSO criteria. Also, in our opinion, Corus Bankshares, Inc. maintained, in all material respects, effective internal control over financial reporting as of December 31, 2005, based on the COSO criteria.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the 2005 consolidated financial statements of Corus Bankshares, Inc. and our report dated February 24, 2006, expressed an unqualified opinion thereon.

Message

Chicago, Illinois

February 24, 2006

CORUS BANKSHARES 2005 ANNUAL REPORT     41

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MANAGEMENTS REPORT on INTERNAL
CONTROLover  FINANCIAL REPORTING

Management of Corus Bankshares, Inc. (Corus) is responsible for establishing and maintaining adequate internal control over financial reporting pursuant to the rules and regulations of the Securities and Exchange Commission. Corus internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of consolidated financial statements for external purposes in accordance with U.S. generally accepted accounting principles. Internal control over financial reporting includes those written policies and procedures that:

| | pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the company;                                                            
|- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  |                                                                                                                                                                                                                          
| | provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles;                                      
|  |                                                                                                                                                                                                                          
| | provide reasonable assurance that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and                                         
|  |                                                                                                                                                                                                                          
| | provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the companys assets that could have a material effect on the consolidated financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Management assessed the effectiveness of Corus internal control over financial reporting as of December 31, 2005. Management based this assessment on criteria for effective internal control over financial reporting described in Internal Control  Integrated Framework, issued by the Committee of Sponsoring Organizations of the Treadway Commission. Managements assessment included an evaluation of the design of Corus internal control over financial reporting and testing of the operational effectiveness of its internal control over financial reporting. Management reviewed the results of its assessment with the Audit Committee of our Board of Directors.

Based on this assessment, management determined that, as of December 31, 2005, Corus maintained effective internal control over financial reporting.

Ernst & Young LLP, an independent registered public accounting firm who audited and reported on the consolidated financial statements of Corus, included in this annual report an attestation report on managements assessment of Corus internal control over financial reporting.

February 13, 2006

42     CORUS BANKSHARES 2005 ANNUAL REPORT

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MANAGEMENTS DISCUSSION and ANALYSIS
ofFINANCIAL CONDITION andRESULTSof  OPERATIONS

|RESULTS   OF OPERATIONS
|-----------------------
|                       

Corus Bankshares, Inc. (Corus) reported net income of $137.2 million in 2005, compared with $97.9 million and $58.4 million in 2004 and 2003, respectively. This translates to diluted earnings per share of $4.76, $3.40, and $2.04 for 2005, 2004, and 2003, respectively. Return on average common shareholders equity was 21.8% for 2005, 17.4% for 2004, and 11.6% for 2003. The return on average assets was 2.1% in 2005, compared with 2.4% and 2.0% in 2004 and 2003, respectively.

NET INTEREST INCOME AND NET INTEREST MARGIN

Net interest income, which is the difference between interest income and fees on
earning assets and interest expense on deposits and borrowings, is the major
source of earnings for Corus. The related net interest margin (the
NIM) represents net interest income as a percentage of the average
earning assets during the period. For the year ended December 31, 2005,
Corus net interest income increased to $249.7 million compared to $151.5
million and $123.4 million for the years ended December 31, 2004 and 2003.
Corus NIM for 2005 was 3.87%, essentially flat compared to 2004.
This is down somewhat from the NIM in 2003 of 4.34%.

The growth in net interest income since 2003 is due primarily to the tremendous growth in the commercial real estate loan portfolio. Since 2003, average commercial real estate loans outstanding have grown 86%, or 36% per year on an annualized basis, which has been supported by tremendous deposit growth. This loan growth, coupled with increasing yields, contributed significantly to the overall growth in net interest income.

Corus 2005 NIM remained stable compared to 2004. This was the result of a complex mixture of several factors. First, in 2005, Corus invested a large portion of liquidity reserves in short-term agency securities instead of using federal funds sold. This change resulted in operational efficiencies and spread benefits as well. In addition, loans fees increased to $78.8 million in 2005 from $43.6 million in 2004 and $30.7 million in 2003. Loan fees typically relate to points earned at closing where the recognition of income is deferred and amortized ratably over the term of the loan.

The benefits of higher yields on short-term investments and higher loans fees in 2005 were offset by the impact of deposits increasing quite a bit faster than loans outstanding. In spite of the increased yields on short-term investments, deposits not used to support loan growth result in minimal, if any, net interest income. The mix of these essentially zero margin funds with Corus normal business had a negative impact on the overall net interest margin. With that said, the lower yield on these assets is a direct reflection of their short term and very high quality. In order to have cash available at all times for deposit and loan customers, Corus wholly-owned subsidiary, Corus Bank, N.A. (the Bank), maintains high levels of liquid investments. Maintaining large amounts of liquid investments is a conscious action undertaken as part of managements broader strategy of enhancing

the safety of operations.

In 2004, the NIM declined by 45 basis points from 2003. Similar to 2005, this decrease was primarily the result of deposit growth in excess of loan growth. While this has a negative impact on the NIM, deposits are the lifeblood of the Bank and management is extremely pleased to have been able to achieve such strong deposit growth.

Finally, with the exception of mezzanine loans, interest rates on the majority of Corus commercial real estate loans adjust in accordance with changes in market interest rates. Furthermore, many of these variable rate loans have interest rate floors embedded within them, which, regardless of market interest rates, set a minimum interest rate for the loan. During periods of low market interest rates, these interest rate floors can contribute significantly to Corus NIM. As of December 31, 2005, market interest rates have climbed to levels where all of the interest rate floors are out of the money. Importantly, none of Corus variable rate loans are capped (i.e., include any limits on maximum interest rates).

CORUS BANKSHARES 2005 ANNUAL REPORT     43

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MANAGEMENTS DISCUSSION and ANALYSISofFINANCIAL
CONDITIONand RESULTSof OPERATIONS(Continued)

AVERAGE BALANCE SHEETS AND NET INTEREST MARGIN

|                                                            |  | 2005              |           | 2004                              |   | 2003          | 
|----------------------------------------------------------- |  | ----------------- | --------- | --------------------------------- | - | ------------- | 
|                                                            |  |                   |           |                                   |   |               | 
|YEARS   ENDED DECEMBER 31                                   |  | AVERAGE   BALANCE |           | INTEREST,   FEES, AND   DIVIDENDS |   | YIELD/   COST | 
|                                                            |  |                   |           |                                   |   |               | 
|(dollars in thousands)                                      |  |                   |           |                                   |   |               | 
|ASSETS                                                      |  |                   |           |                                   |   |               | 
|Earning Assets:                                             |  |                   |           |                                   |   |               | 
|Federal   funds sold                                        |  | $                 | 761,813   |                                   | $ | 21,935        | 
|Taxable   securities other than common stocks               |  |                   | 2,003,221 |                                   |   | 71,561        | 
|Common   stocks (1)                                         |  |                   | 200,356   |                                   |   | 9,031         | 
|Tax-advantaged   securities (2)                             |  |                   | 5,161     |                                   |   | 129           | 
|Trading   account securities                                |  |                   |          |                                   |   |              | 
|CRE   loans, net (3)                                        |  |                   | 3,422,074 |                                   |   | 335,385       | 
|Other   loans, net                                          |  |                   | 129,803   |                                   |   | 11,488        | 
|                                                            |  |                   |           |                                   |   |               | 
|Total   Earning Assets                                      |  |                   | 6,522,428 |                                   |   | 449,529       | 
|Noninterest-earning assets:                                 |  |                   |           |                                   |   |               | 
|Cash   and due from banks  noninterest-bearing             |  |                   | 103,222   |                                   |   |               | 
|Allowance   for loan losses                                 |  |                   | (34,226   | )                                 |   |               | 
|Premises   and equipment, net                               |  |                   | 25,927    |                                   |   |               | 
|Other   assets, including goodwill                          |  |                   | 30,886    |                                   |   |               | 
|                                                            |  |                   |           |                                   |   |               | 
|Total Assets                                                |  | $                 | 6,648,237 |                                   |   |               | 
|                                                            |  |                   |           |                                   |   |               | 
|LIABILITIES   AND SHAREHOLDERS EQUITY                      |  |                   |           |                                   |   |               | 
|Deposits  interest-bearing:                                |  |                   |           |                                   |   |               | 
|Retail   certificates of deposit                            |  | $                 | 2,869,613 |                                   | $ | 104,733       | 
|Money   market deposits                                     |  |                   | 1,562,308 |                                   |   | 50,899        | 
|Brokered   certificates of deposit                          |  |                   | 438,043   |                                   |   | 16,893        | 
|NOW
deposits                                                |  |                   | 307,605   |                                   |   | 5,190         | 
|Savings   deposits                                          |  |                   | 158,111   |                                   |   | 783           | 
|                                                            |  |                   |           |                                   |   |               | 
|Total   Interest-Bearing Deposits                           |  |                   | 5,335,680 |                                   |   | 178,498       | 
|Long-term   debt  subordinated debentures                  |  |                   | 297,879   |                                   |   | 17,991        | 
|Other   borrowings (4)                                      |  |                   | 12,785    |                                   |   | 802           | 
|                                                            |  |                   |           |                                   |   |               | 
|Total   Interest-Bearing Liabilities                        |  |                   | 5,646,344 |                                   |   | 197,291       | 
|Noninterest-bearing   liabilities and shareholders equity: |  |                   |           |                                   |   |               | 
|Noninterest-bearing   deposits                              |  |                   | 296,648   |                                   |   |               | 
|Other   liabilities                                         |  |                   | 74,844    |                                   |   |               | 
|Shareholders equity                                        |  |                   | 630,401   |                                   |   |               | 
|                                                            |  |                   |           |                                   |   |               | 
|Total   Liabilities and Shareholders Equity                |  | $                 | 6,648,237 |                                   |   |               | 
|                                                            |  |                   |           |                                   |   |               | 
|Earning assets                                              |  | $                 | 6,522,428 |                                   | $ | 449,529       | 
|Interest-bearing liabilities                                |  |                   | 5,646,344 |                                   |   | 197,291       | 
|                                                            |  |                   |           |                                   |   |               | 
|Net Interest Spread                                         |  |                   |           |                                   | $ | 252,238       | 
|                                                            |  |                   |           |                                   |   |               | 
|Net Interest Margin                                         |  |                   |           |                                   |   |               | 
|                                                            |  |                   |           |                                   |   |               | 

|Tax   equivalent adjustments are based on a federal income tax rate of 35%.
|---------------------------------------------------------------------------
|(1)                                                                        
|(2)                                                                        
|(3)                                                                        
|(4)                                                                        

44CORUS BANKSHARES 2005 ANNUAL REPORT

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The following table, which presents the components of changes in net interest income by volume and rate, provides further evidence supporting the preceding discussion.

NET INTEREST INCOME VOLUME/RATE ANALYSIS

|                                                |  | 2005
COMPARED   TO
2004 |         | 2004
COMPARED   TO
2003 |  
|----------------------------------------------- |  | ----------------------- | ------- | ----------------------- | -
|                                                |  |                         |         |                         |  
|                                                |  | CHANGE DUE TO (1)       |         |                         |  
|                                                |  |                         |         | TOTAL                   |  
|YEARS ENDED DECEMBER 31                         |  | VOLUME                  |         | RATE                    |  
|                                                |  |                         |         |                         |  
|(dollars in thousands)                          |  |                         |         |                         |  
|Federal funds sold                              |  | $                       | (7,590  | )                       | $
|Investment securities(2)   (3)                  |  |                         | 67,720  |                         |  
|Loans, net of unearned   discount(3) (4)        |  |                         | 96,159  |                         |  
|                                                |  |                         |         |                         |  
|Total Increase in Interest   Income             |  |                         | 156,289 |                         |  
|                                                |  |                         |         |                         |  
|Retail certificates of   deposit                |  |                         | 66,660  |                         |  
|Money market deposits                           |  |                         | 6,607   |                         |  
|Brokered certificates of   deposit              |  |                         | (3,636  | )                       |  
|NOW deposits                                    |  |                         | 817     |                         |  
|Savings deposits                                |  |                         | (45     | )                       |  
|Borrowings                                      |  |                         | 3,373   |                         |  
|                                                |  |                         |         |                         |  
|Total Increase (Decrease) in   Interest Expense |  |                         | 73,776  |                         |  
|                                                |  |                         |         |                         |  
|Increase in Net Interest   Income               |  | $                       | 82,513  |                         | $
|                                                |  |                         |         |                         |  

|(1) 
The net changes attributable   to the combined impact of volume and rate have been allocated equally to both   volume and rate.    
|----------------------------------------------------------------------------------------------------------------------------------------
|(2) 
Dividends on common stocks   reflect a tax equivalent adjustment for the 70% dividends received deduction.                         
|(3) 
Interest income on   tax-advantaged loans and securities reflects a tax equivalent adjustment   based on an income tax rate of 35%.
|(4) 
Includes net interest   income derived from interest rate swap contracts.                                                          

Finally, the following table shows Corus average earning assets for the last three years.

Average Earning Assets

|                                      |  | 2005   |           | 2004    |  | 2003   |  
|------------------------------------- |  | ------ | --------- | ------- |  | ------ | -
|                                      |  |        |           |         |  |        |  
|YEARS ENDED DECEMBER 31               |  | AMOUNT |           | PERCENT |  | AMOUNT |  
|                                      |  |        |           |         |  |        |  
|(dollars in thousands)                |  |        |           |         |  |        |  
|Loans:                                |  |        |           |         |  |        |  
|Commercial   real estate:             |  |        |           |         |  |        |  
|Senior   non-construction             |  | $      | 1,691,624 |         |  | 25.9   | %
|Senior   construction                 |  |        | 1,604,541 |         |  | 24.6   | %
|Mezzanine                             |  |        | 125,909   |         |  | 1.9    | %
|                                      |  |        |           |         |  |        |  
|Total   Commercial Real Estate        |  |        | 3,422,074 |         |  | 52.4   | %
|Commercial                            |  |        | 85,742    |         |  | 1.3    | %
|Residential   real estate and other   |  |        | 44,061    |         |  | 0.7    | %
|                                      |  |        |           |         |  |        |  
|Total   Loans                         |  |        | 3,551,877 |         |  | 54.4   | %
|Federal funds sold                    |  |        | 761,813   |         |  | 11.7   | %
|Common stocks                         |  |        | 200,356   |         |  | 3.1    | %
|Securities other than common   stocks |  |        | 2,008,382 |         |  | 30.8   | %
|                                      |  |        |           |         |  |        |  
|Total Earning Assets                  |  | $      | 6,522,428 |         |  | 100.0  | %
|                                      |  |        |           |         |  |        |  

CORUS BANKSHARES 2005 ANNUAL REPORT     45

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MANAGEMENTS DISCUSSION and ANALYSIS
ofFINANCIAL CONDITION and RESULTS of OPERATIONS(Continued)

NONINTEREST INCOME

For 2005, Corus reported $27.9 million of total Noninterest income compared to
$51.4 million in 2004 and $16.9 million in 2003. The fluctuations from year to
year are primarily the result of securities gains. Excluding securities gains,
noninterest income increased in 2005 by $1.2 million, or 8.5%, and decreased in
2004 by $0.5 million, or 3.4%.

NONINTEREST INCOME

|YEARS ENDED DECEMBER 31                                        |  | 2005 |        | 2004 |   | 2003   |  | 2005/2004
CHANGE |        | 2004/2003
CHANGE | 
|-------------------------------------------------------------- |  | ---- | ------ | ---- | - | ------ |  | ---------------- | ------ | ---------------- | 
|                                                               |  |      |        |      |   |        |  |                  |        |                  | 
|(dollars in thousands)                                         |  |      |        |      |   |        |  |                  |        |                  | 
|Service charges on deposit   accounts                          |  | $    | 11,566 |      | $ | 11,438 |  | $                | 11,878 |                  | 
|Securities gains/(losses),   net                               |  |      | 12,691 |      |   | 37,349 |  |                  | 2,366  |                  | 
|Other                                                          |  |      | 3,692  |      |   | 2,628  |  |                  | 2,676  |                  | 
|                                                               |  |      |        |      |   |        |  |                  |        |                  | 
|Total Noninterest Income                                       |  | $    | 27,949 |      | $ | 51,415 |  | $                | 16,920 |                  | 
|                                                               |  |      |        |      |   |        |  |                  |        |                  | 
|Noninterest Income,   Excluding Securities Gains/(Losses), Net |  | $    | 15,258 |      | $ | 14,066 |  | $                | 14,554 |                  | 
|                                                               |  |      |        |      |   |        |  |                  |        |                  | 
|NM  Not Meaningful                                           

Service Charges on Deposit AccountsWhile service charge income for 2005 was essentially flat compared to
2004, this was the result of two offsetting items. First, service charge income
from Corus business of servicing the check cashing industry increased in
2005 due primarily to the expiration of payments required to a third party in
accordance with a previously negotiated fee-sharing agreement. Offsetting this
increase were lower fees from business accounts. The decline in business account
fees was driven by the impact of higher short-term interest rates which result
in higher earnings credits to the customers and lower net service charge income
to Corus.

In 2004, service charge income decreased compared to 2003 by $440,000, or 3.7%. The decrease was partially the result of the impact of increases in short-term interest rates, as described above. In addition, fees earned from personal accounts decreased due to the elimination of service charges for both Internet Banking and Bill Payment services.

Securities Gains/(Losses), NetIn 2005, net security gains totaled $12.7 million, compared to $37.3 million and $2.4 million in 2004 and 2003, respectively.

SECURITIES GAINS/(LOSSES), NET

|YEARS ENDED DECEMBER 31                               |  | 2005 |        | 2004 |   | 2003   | 
|----------------------------------------------------- |  | ---- | ------ | ---- | - | ------ | 
|                                                      |  |      |        |      |   |        | 
|(dollars in thousands)                                |  |      |        |      |   |        | 
|Gains on common stocks (cash   transactions)          |  | $    | 12,599 |      | $ | 10,067 | 
|Gains on common stocks   (stock-for-stock)            |  |      | 810    |      |   | 21,515 | 
|Charge for other than   temporary impairment        |  |      | (880   | )    |   |       | 
|Sales of other   available-for-sale securities        |  |      | 144    |      |   | 13     | 
|Mark-to-market adjustments   on non-hedge derivatives |  |      | 18     |      |   | 1,525  | 
|Trading account   gains/(losses), net                 |  |      |       |      |   | 4,229  | 
|                                                      |  |      |        |      |   |        | 
|Total Securities   Gains/(Losses), net                |  | $    | 12,691 |      | $ | 37,349 | 
|                                                      |  |      |        |      |   |        | 

46     CORUS BANKSHARES 2005 ANNUAL REPORT

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Gains on Common StocksGains on common stocks relate to Corus common stock portfolio of various financial industry companies. Gains or losses are recognized either when the investment is sold or when the company is acquired, for cash or stock, by another company. Gains recognized from sales of stock totaled $12.6 million, $10.1 million, and $7.3 million for the years ended December 31, 2005, 2004, and 2003, respectively.

The gains from stock-for-stock transactions resulted from several mergers, primarily in 2004. Prior to each merger, Corus held positions in the acquired company and, in some cases, the acquiring company as well. Importantly, gains from stock-for-stock transactions have no cash flow impact and, as a result, no tax is payable on the gain until the underlying securities are sold.

Charge for Other Than Temporary ImpairmentCorus recorded charges related to other than temporary declines in value of certain common stocks in both 2005 and 2003. These charges were not a result of the Company selling the associated stocks, but rather an accounting entry with no cash flow or tax implications.

Corus general practice is to recognize impairment losses on individual equity securities when the security has been in a loss position at the close of each trading day during six (6) consecutive months as of any quarter end. The exception to this general policy would be in the event that a security suffers a rapid and material decrease in value that Corus determines to be other than temporary in nature. In these cases, Corus will recognize an impairment charge at the time such determination is made. Corus evaluates its investments for other than temporary declines in value on a lot-by-lot basis, meaning that if there are multiple purchases of a certain security, each purchase is evaluated individually.

Mark-to-Market Adjustments on Non-Hedge DerivativesMark-to-market adjustments on non-hedge derivatives relate primarily to basis swaps previously held by Corus. The basis swaps were sold in April 2004 and mark-to-market adjustments associated with the remaining non-hedge derivatives have been, and are expected to remain, immaterial.

Trading Account Gains/(Losses), NetFrom time to time, the Bank may enter into security transactions in anticipation of taking gains on short-term price movements. Eligible trading securities include Treasury securities, agency securities, and interest rate derivatives. All open trading positions are monitored closely by senior management and loss limits are in place to reduce potential losses. Securities purchased for trading purposes are, at the time of purchase, clearly indicated as trading securities on the Companys books. Taking any action that would require the reclassification of any security to another classification after it has been initially designated as trading, available-for-sale, or held-to-maturity, is against the Banks policy and requires approval by the Banks Board of Directors.

Trading securities are marked to market on an ongoing basis with the resulting gain or loss included in income. In 2005, Corus did not enter into any trading transactions. In 2004 and 2003, Corus recorded net trading gains of $4.2 million and $0.7 million, respectively.

OTHER INCOME

In 2005, other income increased by $1.1 million to $3.7 million. The majority of this increase was due to a gain of approximately $1.4 million on the sale of certain property owned by Corus. Corus had previously been leasing the property to a third party. Other income also includes ATM fees, safe deposit box rental income, and various other customer fees.

CORUS BANKSHARES 2005 ANNUAL REPORT     47

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MANAGEMENTS DISCUSSIONand ANALYSIS of FINANCIAL CONDITION and
RESULTS of OPERATIONS(Continued)

NONINTEREST EXPENSE

Total Noninterest expense increased $5.0 million, or 9.0%, in 2005, and $3.7 million, or 7.1%, in 2004. The increase was primarily driven by increases in employee compensation and benefits as discussed further below.

NONINTEREST EXPENSE

|YEARS ENDED DECEMBER 31                |  | 2005 |        | 2004 |   | 2003   |   | 2005/2004
CHANGE |        | 2004/2003
CHANGE | 
|-------------------------------------- |  | ---- | ------ | ---- | - | ------ | - | ---------------- | ------ | ---------------- | 
|                                       |  |      |        |      |   |        |   |                  |        |                  | 
|(dollars in thousands)                 |  |      |        |      |   |        |   |                  |        |                  | 
|Employee compensation and   benefits   |  | $    | 43,136 |      | $ | 38,458 |   | $                | 34,426 |                  | 
|Net occupancy                          |  |      | 3,723  |      |   | 3,764  |   |                  | 4,231  |                  | 
|Data processing                        |  |      | 1,714  |      |   | 2,435  |   |                  | 2,722  |                  | 
|Depreciationfurniture and   equipment |  |      | 1,444  |      |   | 1,750  |   |                  | 1,823  |                  | 
|Other                                  |  |      | 11,305 |      |   | 9,866  |   |                  | 9,331  |                  | 
|                                       |  |      |        |      |   |        |   |                  |        |                  | 
|Total Noninterest Expense              |  | $    | 61,322 |      | $ | 56,273 |   | $                | 52,533 |                  | 
|                                       |  |      |        |      |   |        |   |                  |        |                  | 
|Efficiency ratio                       |  |      | 22.9   | %    |   | 33.5   | % |                  | 37.5   | %                | 
|                                       |  |      |        |      |   |        |   |                  |        |                  | 

Employee Compensation and BenefitsIn 2005, employee compensation and benefits increased $4.7 million, or 12.2%, compared to the prior year. This increase is largely attributable to higher staffing levels and increases in commercial loan officer commission accruals. The higher staffing levels were the result of additional personnel hired to support the ongoing deposit and loan growth. Salaries and bonuses, other than the commission-based commercial loan officer compensation, increased for the year by $2.1 million, or 9.4%.

The commercial loan officer commission accruals are driven by the Commission Program for Commercial Loan Officers (the CLO Program). The purpose of the CLO Program is to reward commercial loan Officers for new business development on the basis of each individual officers loan volume generation. An additional, and critical, aspect of this compensation program is that each officer shares in the risk of loss on the loans they generate. A substantial portion of officers commission is held back for many years and is at risk of loss in the event any of their loans fail to perform. This holdback provision is designed to more closely align the goals of the commercial loan officers with the interests of Corus and its shareholders.

Total commissions are calculated in accordance with the formula set forth in the CLO Program. The following table illustrates the compensation expense related to the CLO Program for the last three years:

|YEARS ENDED DECEMBER 31    |  | 2005 |        | 2004 |   | 2003   | 
|-------------------------- |  | ---- | ------ | ---- | - | ------ | 
|                           |  |      |        |      |   |        | 
|(dollars in thousands)     |  |      |        |      |   |        | 
|Salaries(1)                |  | $    | 2,449  |      | $ | 2,390  | 
|Commissions paid in cash   |  |      | 6,855  |      |   | 3,884  | 
|Commissions held back      |  |      | 3,870  |      |   | 5,108  | 
|                           |  |      |        |      |   |        | 
|Total Compensation Expense |  | $    | 13,174 |      | $ | 11,382 | 
|                           |  |      |        |      |   |        | 

|(1) | A portion   of salaries are treated as an advance against commissions.
|--- | ----------------------------------------------------------------------

While total commissions are expensed each year, only a portion is paid in that year with the remainder held back for many years. The commercial loan officers have various options for investing the holdbacks including 1)units that are each equivalent to a share of Corus common stock (Corus Stock Holdback), 2)an account with returns based on an investment that is a function of the S&P 500 Index (S&P Holdback), and 3)cash with interest credited based on the prevailing Treasury rate during the holdback period (Treasury Holdback).

Due to the nature of different holdback options, they are recorded differently in Corus financial statements.

48CORUS BANKSHARES 2005 ANNUAL REPORT

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Specifically, Corus Stock Holdbacks are recorded as equity and included in capital surplus. No market adjustments are made to Corus Stock Holdbacks and no additional expense is recorded. Conversely, Treasury Holdbacks and S&P Holdbacks are both recorded as liabilities. Interest earned on Treasury Holdbacks is recorded monthly with a charge to compensation expense. Changes in the value of S&P Holdbacks are recorded monthly with the offset recorded to compensation expense.

The following table reflects the market value of the holdbacks as of December 31, 2005 and 2004:

|DECEMBER 31              |  | 2005 |        | 2004 |  
|------------------------ |  | ---- | ------ | ---- | -
|                         |  |      |        |      |  
|(dollars in thousands)   |  |      |        |      |  
|Corus Stock              |  | $    | 27,641 |      | $
|S&P 500                  |  |      | 4,713  |      |  
|Treasury                 |  |      | 2,066  |      |  
|                         |  |      |        |      |  
|Total Value of Holdbacks |  | $    | 34,420 |      | $
|                         |  |      |        |      |  

As mentioned above, Corus Stock Holdbacks are recorded directly to equity with no subsequent adjustments for changes in the market value of Corus common stock. As a result, the Corus Stock Holdbacks, as recorded in the financial statements, total $13.2 million and $12.8 million at December 31, 2005 and 2004, respectively.

The CLO Program allows for the release of holdbacks in instances where an officers holdback is no longer considered to be at a substantial risk of forfeiture, as calculated under the CLO Program. In addition, no current year holdback will be required for those officers receiving such releases. In 2005, releases were valued at $4.3 million and included both S&P Holdbacks and Corus Stock Holdbacks. There were no releases in 2004.

Importantly, holdbacks are subject to reduction on an officer-by-officer basis in the event of loan losses. Therefore, the holdbacks effectively provide Corus with an additional loan loss reserve to the extent Corus can recover a portion of any commercial real estate loan losses by reducing or eliminating the holdbacks.

Finally, Corus effectively hedges the liability associated with holdbacks by either purchasing the equivalent investment in the S&P 500 or by repurchasing and retiring Corus common stock in amounts equivalent to the respective holdbacks. Corus internally hedges the Treasury Holdbacks.

Corus continues to focus on effectively controlling compensation expense by paying a limited number of talented people a premium over market. This policy results in higher employee productivity and an increased willingness to accept more responsibility in carrying out Corus goals and objectives.

Net OccupancyIn 2005, net occupancy expense remained relatively flat.
The decrease from 2003 to 2004 was predominantly due to deferred expenses
becoming fully amortized.

Data ProcessingIn 2005, data processing decreased by $0.7 million, or
29.6%, to $1.7 million compared to 2004. This decrease was due to the savings
provided by implementing a new core data processing system in the second quarter
of 2004. In 2004, data processing decreased by $0.3 million from $2.7 million in
2003 as a result of the new system.

Furniture and Equipment DepreciationIn 2005, depreciation of furniture and equipment decreased by $306,000, or 17.5%, compared to 2004. In 2004, depreciation remained relatively flat.

CORUS BANKSHARES 2005 ANNUAL REPORT     49

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MANAGEMENTS DISCUSSION and ANALYSISof FINANCIAL CONDITIONandRESULTS of OPERATIONS(Continued)

Other ExpensesOther noninterest expense consists of various expenses, the most significant being: audits & exams, stationery & supplies, legal & professional, insurance, equipment repairs & maintenance, advertising, armored courier costs, postage, and correspondent bank charges.

In 2005, other expenses increased by $1.4 million, or 14.6%, to $11.3 million compared to 2004. The increase is attributable to costs associated with growth in assets and deposits, specifically deposit insurance, software costs, account origination fees, promotional costs and the asset-based regulatory exam fee.

In 2004, other expenses increased by $535,000, or 5.7%, to $9.9 million compared to 2003. The increase is primarily incremental audit fees in excess of $500,000. The audit fee increases were directly attributable to the cost of additional resources needed for the implementation of the internal control review required by Section 404 of the Sarbanes-Oxley Act of 2002.

Efficiency RatioThe banking industry uses a standard known as the efficiency ratio to measure a banks operational efficiency. The ratio is derived by dividing gross operating expenses by the sum of fully taxable equivalent net interest and other income, adjusted for securities gains and losses. Corus efficiency ratio was 22.9%, 33.5%, and 37.5% in 2005, 2004, and 2003, respectively. Management continues to effectively limit increases in operating expenses as the Companys revenues grow.

Cost ManagementCost management is a fundamental element of Corus culture. Management constantly reviews operating expenses to ensure that they are minimized while maintaining a high level of quality customer service. Corus remains committed to identifying additional reductions in costs while maintaining superior customer service and stringent internal controls.

Income TaxesIncome tax expense was $73.1 million in 2005, compared to $48.7 million and $29.4 million in 2004 and 2003, respectively. The effective tax rate remained relatively flat at 34.7% in 2005, 33.2% in 2004, and 33.5% in 2003. Differences between the effective tax rate and the statutory federal rate are driven by both state taxes and nontaxable income or nondeductible expenses. For Corus, the most significant item relates to the favorable tax treatment allowed for dividend income  only 30% of dividend income received is taxable. Please refer to Note 9 to Consolidated Financial Statements for a reconciliation of the statutory federal income tax rate to the effective rate.

Corus net deferred tax liability was $6.0 million at December 31, 2005, compared with a net deferred tax liability of $18.6 million at December 31, 2004. The decrease was primarily due to lower unrealized securities gains. Changes in unrealized securities gains are a function of both market price fluctuations related to securities held by the Company and by gains realized during the year as a result of sales. During 2005, Corus sold $35 million of common stocks, which resulted in gains of $12.6 million.

InflationThe impact of inflation on a financial institution differs significantly from that of an industrial company, as virtually all assets and liabilities of a financial institution are monetary in nature. Monetary items, such as cash, loans and deposits, are those assets and liabilities that are or will be converted into a fixed number of dollars regardless of changes in prices. Management believes the impact of inflation on financial results depends upon Corus ability to react to changes in interest rates. Interest rates do not necessarily move in the same direction, or at the same magnitude, as the prices of other goods and services. Management seeks to manage the relationship between interest-sensitive assets and liabilities in order to protect against wide interest rate fluctuations, including those resulting from inflation.

50CORUS BANKSHARES 2005 ANNUAL REPORT

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|FINANCIAL   CONDITION
|---------------------
|                     

COMMON STOCKS

At December 31, 2005, Corus held investments in the common stocks of 18 financial industry companies valued at $184.5 million, including net unrealized gains of $74.0 million.

The following is a list of Corus holdings as of December 31, 2005:

|CORPORATION                        |  | SHARES   HELD |         | MARKET   VALUE |   | PERCENTAGE OF PORTFOLIO | 
|---------------------------------- |  | ------------- | ------- | -------------- | - | ----------------------- | 
|                                   |  |               |         |                |   |                         | 
|(dollars in thousands)             |  |               |         |                |   |                         | 
|Amcore Financial Inc.              |  |               | 69,100  |                | $ | 2,101                   | 
|Amsouth Bancorporation             |  |               | 466,015 |                |   | 12,214                  | 
|Associated Banc Corp.              |  |               | 121,179 |                |   | 3,944                   | 
|Bank of America Corp.              |  |               | 670,594 |                |   | 30,948                  | 
|Bank of New York Co. Inc.          |  |               | 100,000 |                |   | 3,185                   | 
|Citigroup Inc.                     |  |               | 225,000 |                |   | 10,919                  | 
|Comerica Inc.                      |  |               | 264,300 |                |   | 15,002                  | 
|Compass Bancshares Inc.            |  |               | 108,750 |                |   | 5,247                   | 
|Fremont General Corp.              |  |               | 820,000 |                |   | 19,049                  | 
|JP Morgan Chase & Co.              |  |               | 500,864 |                |   | 19,879                  | 
|MAF Bancorp Inc.                   |  |               | 204,850 |                |   | 8,477                   | 
|Merrill Lynch & Co. Inc.           |  |               | 132,000 |                |   | 8,940                   | 
|Morgan Stanley Dean Witter   & Co. |  |               | 82,000  |                |   | 4,653                   | 
|National City Corp.                |  |               | 74,520  |                |   | 2,502                   | 
|Regions Financial Corp.            |  |               | 143,554 |                |   | 4,904                   | 
|SunTrust Banks Inc.                |  |               | 48,000  |                |   | 3,492                   | 
|US Bancorp                         |  |               | 268,870 |                |   | 8,037                   | 
|Wachovia Corp.                     |  |               | 398,191 |                |   | 21,048                  | 
|                                   |  |               |         |                |   |                         | 
|Total                              |  |               |         |                | $ | 184,541                 | 
|                                   |  |               |         |                |   |                         | 

In 2005, Corus received dividends on the stock portfolio of $6.6 million compared to $6.3 million in 2004 and $5.3 million in 2003. In addition to dividend income, Corus also recognized net security gains of $12.5 million in 2005 (net of the charge for other than temporary impairment of $0.9 million), $31.6 million in 2004, and $1.1 million in 2003 (net of the charge for other than temporary impairment of $9.0 million) related to the common stock portfolio. See Noninterest Income for further discussion.

SECURITIES OTHER THAN COMMON STOCKS

Corus current asset/liability management philosophy is that all current security purchases, other than those required for regulatory purposes, are classified as available-for-sale or trading. This is due to managements belief that virtually all securities should be available to be sold in conjunction with Corus liquidity and asset/liability management strategies.

At December 31, 2005, available-for-sale securities other than common stocks increased to $3.2 billion, due mainly to Corus increased investment in short-term U.S. Government and agency notes. As of December 31, 2005, the entire available-for-sale portfolio with stated maturities was scheduled to mature within one year.

CORUS BANKSHARES 2005 ANNUAL REPORT     51

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MANAGEMENTS DISCUSSION and ANALYSISof FINANCIAL CONDITIONandRESULTS of OPERATIONS(Continued)

LOANS

The following table details the composition of Corus loan portfolio:

LOAN PORTFOLIO

|                                    |  | 2005   |           | 2004    | 
|----------------------------------- |  | ------ | --------- | ------- | 
|                                    |  |        |           |         | 
|DECEMBER 31                         |  | AMOUNT |           | PERCENT | 
|                                    |  |        |           |         | 
|(dollars in thousands)              |  |        |           |         | 
|Commercial real estate:             |  |        |           |         | 
|Senior   construction               |  | $      | 2,157,955 |         | 
|Senior   non-construction           |  |        | 2,114,037 |         | 
|Mezzanine                           |  |        | 132,432   |         | 
|                                    |  |        |           |         | 
|Total   Commercial Real Estate      |  |        | 4,404,424 |         | 
|Commercial                          |  |        | 84,381    |         | 
|Residential real estate and   other |  |        | 35,706    |         | 
|                                    |  |        |           |         | 
|Total Loans                         |  | $      | 4,524,511 |         | 
|                                    |  |        |           |         | 

Commercial Real Estate LendingCommercial real estate loans are comprised of senior construction, senior non-construction, and mezzanine loans. Senior construction loans typically have stated maturities ranging from 2 to 4 years. The loans are funded throughout the term as construction progresses. These loans consist of both new construction projects and condominium conversion projects where extensive renovation is planned (those with less extensive renovations required are included in non-construction, as discussed below).

Senior non-construction loans generally have shorter stated maturities, typically in the range of 1 to 3 years. The majority of these non-construction loans are to borrowers in the business of converting apartments to condominiums with less extensive renovation efforts. These loans are typically fully funded at the outset and paid down as the condominiums are sold. The remaining senior non-construction loans are typically amortizing loans collateralized by income-producing properties such as hotels, office buildings, or apartment projects.

Corus mezzanine loans are essentially second mortgage loans on commercial real estate projects and are all subordinate to a Corus first mortgage loan (as opposed to a third partys). Interest rates charged for mezzanine loans are considerably higher than those charged for typical first mortgage loans, but the loans also carry additional risk.

The commercial real estate lending activity primarily finances one of four types of real estate: condominiums, hotels, office buildings, and apartment projects. Corus loans finance projects in major markets nationwide with a target loan size from $20 million to $150 million.

At December 31, 2005, funded commercial real estate loans totaled $4.4 billion, an increase of $1.8 billion, or 67%, compared to the prior year. This, however, only reflects actual balances outstanding, which excludes commitments. While not yet funded, commitments, which consist of unfunded loan amounts and commitment letters issued, are also a significant part of the loan portfolio. Including commitments, the commercial real estate loan portfolio totals $8.3 billion at December 31, 2005 and $5.3 billion at December 31, 2004.

52     CORUS BANKSHARES 2005 ANNUAL REPORT

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The following table provides a reconciliation of commercial real estate loans outstanding to the total including commitments:

COMMERCIAL REAL ESTATE LOAN PORTFOLIO

|                                           |  | 2005   |           | 2004    | 
|------------------------------------------ |  | ------ | --------- | ------- | 
|                                           |  |        |           |         | 
|DECEMBER 31                                |  | AMOUNT |           | PERCENT | 
|                                           |  |        |           |         | 
|(dollars in thousands)                     |  |        |           |         | 
|Funded commercial real   estate loans, net |  | $      | 4,404,424 |         | 
|Commitments:                               |  |        |           |         | 
|Loansunfunded   portion                   |  |        | 3,526,940 |         | 
|Commitment   Letters(1)                    |  |        | 399,872   |         | 
|Letters   of Credit                        |  |        | 8,495     |         | 
|                                           |  |        |           |         | 
|Total                                      |  | $      | 8,339,731 |         | 
|                                           |  |        |           |         | 

|(1) | Commitment   letters are pending loans for which commitment letters have been issued to   the borrower. These commitment letters are also disclosed in the Commercial   Real Estate Loans Pending table of this report, included in the amounts   labeled as Commitments Accepted and Commitments Offered.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Commercial Real E state Loans  OriginationsCorus originated 97 loans with commitments aggregating $5.4 billion in 2005, an increase of $1.3 billion compared to the commitment amount of $4.1 billion from the 84 loans originated during 2004. The origination amount represents Corus full commitment under the loans, regardless of participations. The non-construction loans are largely funded at the time of closing. In contrast, construction loan funds are often not drawn by the borrower at the closing but rather over an extended period of time as the project is built. Attempting to use loan originations to forecast loan growth is not advisable due to the complicated interplay between funding of new originations and the paydowns and payoffs on loans originated in previous periods.

Commercial Real Estate Loans  PaydownsTotal loan paydowns and payoffs (collectively referred to as paydowns) were $2.5 billion in 2005. This compares to total paydowns of $2.1 billion during 2004. The timing of loan paydowns is inherently difficult to predict. With that said, it is expected that paydowns will generally trend higher as the loan portfolio increases in size.

CORUS BANKSHARES 2005 ANNUAL REPORT     53

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MANAGEMENTS DISCUSSION and ANALYSISof FINANCIAL CONDITIONandRESULTS of OPERATIONS(Continued)

The following tables break out loans by size, property type, and location:

COMMERCIAL REAL ESTATE LOANS  BY SIZE

|                                |  | 2005              |        |  |                     |       | 2004                  |                
|------------------------------- |  | ----------------- | ------ |  | ------------------- | ----- | --------------------- | ---------------
|                                |  |                   |        |  |                     |       |                       |                
|                                |  |                   |        |  | LOANS   OUTSTANDING |       | TOTAL   COMMITMENT(1) |                
|                                |  | NUMBER   OF LOANS |        |  |                     |       |                       | NUMBER
OF LOANS
|                                |  |                   |        |  |                     |       |                       |                
|DECEMBER 31                     |  |                   | AMOUNT |  | %                   |       | AMOUNT                |                
|                                |  |                   |        |  |                     |       |                       |                
|(dollars in millions)           |  |                   |        |  |                     |       |                       |                
|$140 million and above          |  |                   | 2      |  | $                   |      |                       |                
|$100 million to $140 million    |  |                   | 14     |  |                     | 593   |                       |                
|$60 million to $100 million     |  |                   | 31     |  |                     | 1,130 |                       |                
|$20 million to $60 million      |  |                   | 89     |  |                     | 2,294 |                       |                
|$1 million to $20 million       |  |                   | 60     |  |                     | 416   |                       |                
|Less than $1 million            |  |                   | NM     |  |                     | 16    |                       |                
|Deferred fees/other   discounts |  |                   | N/A    |  |                     | (45   | )                     |                
|                                |  |                   |        |  |                     |       |                       |                
|Total                           |  |                   | 196    |  | $                   | 4,404 |                       |                
|                                |  |                   |        |  |                     |       |                       |                

COMMERCIAL REAL ESTATE LOANS  BY PROPERTY TYPE

|                                |  | 2005              |        |  |                     |       | 2004                  |                
|------------------------------- |  | ----------------- | ------ |  | ------------------- | ----- | --------------------- | ---------------
|                                |  |                   |        |  |                     |       |                       |                
|                                |  |                   |        |  | LOANS   OUTSTANDING |       | TOTAL   COMMITMENT(1) |                
|                                |  | NUMBER   OF LOANS |        |  |                     |       |                       | NUMBER
OF LOANS
|                                |  |                   |        |  |                     |       |                       |                
|DECEMBER 31                     |  |                   | AMOUNT |  | %                   |       | AMOUNT                |                
|                                |  |                   |        |  |                     |       |                       |                
|(dollars in millions)           |  |                   |        |  |                     |       |                       |                
|Condominium                     |  |                   |        |  |                     |       |                       |                
|Construction                    |  |                   | 91     |  | $                   | 1,937 |                       |                
|Conversion                      |  |                   | 66     |  |                     | 1,908 |                       |                
|                                |  |                   |        |  |                     |       |                       |                
|Condominium   Total             |  |                   | 157    |  |                     | 3,845 |                       |                
|Hotel                           |  |                   | 13     |  |                     | 252   |                       |                
|Office                          |  |                   | 9      |  |                     | 156   |                       |                
|Rental apartment                |  |                   | 6      |  |                     | 144   |                       |                
|Other                           |  |                   | 11     |  |                     | 36    |                       |                
|Loans less than $1 million      |  |                   | NM     |  |                     | 16    |                       |                
|Deferred fees/other   discounts |  |                   | N/A    |  |                     | (45   | )                     |                
|                                |  |                   |        |  |                     |       |                       |                
|Total                           |  |                   | 196    |  | $                   | 4,404 |                       |                
|                                |  |                   |        |  |                     |       |                       |                

|NM  Not Meaningful
|-------------------
|(1)                

54     CORUS BANKSHARES 2005 ANNUAL REPORT

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COMMERCIAL REAL ESTATE LOANS  BY MAJOR METROPOLITAN AREA

|                                |  | 2005              |        |  |                     |       | 2004                  | 
|------------------------------- |  | ----------------- | ------ |  | ------------------- | ----- | --------------------- | 
|                                |  |                   |        |  |                     |       |                       | 
|                                |  |                   |        |  | LOANS   OUTSTANDING |       | TOTAL   COMMITMENT(1) | 
|                                |  | NUMBER   OF LOANS |        |  |                     |       |                       | 
|                                |  |                   |        |  |                     |       |                       | 
|DECEMBER 31                     |  |                   | AMOUNT |  | %                   |       | AMOUNT                | 
|                                |  |                   |        |  |                     |       |                       | 
|(dollars in millions)           |  |                   |        |  |                     |       |                       | 
|Florida                         |  |                   |        |  |                     |       |                       | 
|Miami/Southeast   Florida       |  |                   | 24     |  | $                   | 563   |                       | 
|Orlando                         |  |                   | 9      |  |                     | 326   |                       | 
|Tampa                           |  |                   | 4      |  |                     | 213   |                       | 
|Other   Florida                 |  |                   | 7      |  |                     | 150   |                       | 
|                                |  |                   |        |  |                     |       |                       | 
|Florida   Total                 |  |                   | 44     |  |                     | 1,252 |                       | 
|California                      |  |                   |        |  |                     |       |                       | 
|San   Diego                     |  |                   | 17     |  |                     | 438   |                       | 
|Los   Angeles                   |  |                   | 16     |  |                     | 256   |                       | 
|San   Francisco                 |  |                   | 6      |  |                     | 110   |                       | 
|Sacramento                      |  |                   | 1      |  |                     | 41    |                       | 
|                                |  |                   |        |  |                     |       |                       | 
|California   Total              |  |                   | 40     |  |                     | 845   |                       | 
|New York City                   |  |                   | 24     |  |                     | 633   |                       | 
|Washington, D.C.(2)             |  |                   | 24     |  |                     | 619   |                       | 
|Las Vegas                       |  |                   | 11     |  |                     | 285   |                       | 
|Chicago                         |  |                   | 16     |  |                     | 219   |                       | 
|Atlanta                         |  |                   | 9      |  |                     | 132   |                       | 
|Other(3)                        |  |                   | 28     |  |                     | 448   |                       | 
|Loans less than $1 million      |  |                   | NM     |  |                     | 16    |                       | 
|Deferred fees/other   discounts |  |                   | N/A    |  |                     | (45   | )                     | 
|                                |  |                   |        |  |                     |       |                       | 
|Total                           |  |                   | 196    |  | $                   | 4,404 |                       | 
|                                |  |                   |        |  |                     |       |                       | 

|NM  Not   Meaningful
|---------------------
|(1)                  
|(2)                  
|(3)                  

Commercial Real Estate Loans  Loans PendingFinally, the following table presents a comparison of Corus loans pending listed in descending order with respect to stage of completion. In other words, a prospective loan categorized as Commitment Accepted is essentially one step away from closing while a prospective loan classified as Term Sheet Issued is in its earliest stages. It has been the Companys experience that pending loans that reach the Application Received stage are highly likely to ultimately close.

CORUS BANKSHARES 2005 ANNUAL REPORT     55

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MANAGEMENTS DISCUSSION and ANALYSISof FINANCIAL CONDITIONandRESULTS of OPERATIONS(Continued)

COMMERCIAL REAL ESTATE LOANS PENDING

|                       |  | 2005              |    | 2004   |  
|---------------------- |  | ----------------- | -- | ------ | -
|                       |  |                   |    |        |  
|DECEMBER 31            |  | NUMBER   OF LOANS |    | AMOUNT |  
|                       |  |                   |    |        |  
|(dollars in millions)  |  |                   |    |        |  
|Commitment accepted(1) |  |                   | 6  |        | $
|Commitment offered(1)  |  |                   | 1  |        |  
|Application received   |  |                   | 22 |        |  
|Application sent out   |  |                   | 11 |        |  
|Term sheet issued      |  |                   | 40 |        |  
|                       |  |                   |    |        |  
|Total                  |  |                   | 80 |        | $
|                       |  |                   |    |        |  

|(1) | These   amounts are also included in the Commercial Real Estate Loan Portfolio table   of this report.
|--- | ------------------------------------------------------------------------------------------------------

In total, loans pending have increased significantly from the same period in 2004. The average commitment amount for the pending loans has also grown to nearly $81 million at December 31, 2005, compared to $59 million at December 31, 2004. The increase reflects managements focus on larger loans.

Commercial LendingCommercial loans are primarily loans to Corus customers in the check cashing industry. Balances fluctuate based on seasonal cash requirements and are generally secured by the equity of the check cashing operation.

Residential Real Estate and Other LendingResidential real estate and other lending balances continue to decline as the Bank allows these portfolios to run-off. Minimal new originations are expected.

ALLOWANCE FOR CREDIT LOSSES

The Allowance for Credit Losses is comprised of the Allowance for Loan Losses and a separate Liability for Credit Commitment Losses. The Allowance for Loan Losses is a reserve against funded loan amounts, while the Liability for Credit Commitment Losses relates to those amounts that Corus is committed to lend but for which funds have not yet been disbursed. In the aggregate, the Allowance for Credit Losses had a balance of $44.7 million at December 31, 2005, which was comprised of a $39.7 million Allowance for Loan Losses and a $5.0 million Liability for Credit Commitment Losses.

In accordance with the results of Corus Allowance for Credit Losses analysis, the Company recorded a provision for credit losses of $6.0 million in 2005. The Allowance for Credit Losses analysis incorporates numerous quantitative measures including historical losses, loan growth, and credit quality, as well as various qualitative factors. In 2004, no provisions for credit losses was necessary. Management believes this was appropriate given the results of managements analysis and the balance of the Allowance for Credit Losses at December 31, 2004. Additionally, in 2004, Corus reclassified $5.0 million of the Allowance for Loan Losses to the Liability for Credit Commitment Losses with no subsequent adjustment necessary.

56     CORUS BANKSHARES 2005 ANNUAL REPORT

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A reconciliation of the activity in the Allowance for Credit Losses is as follows:

|                                                     |  | 2005 |           | 2004 |   | 2003      |  
|---------------------------------------------------- |  | ---- | --------- | ---- | - | --------- | -
|                                                     |  |      |           |      |   |           |  
|(dollars in thousands)                               |  |      |           |      |   |           |  
|Balance at January 1                                 |  | $    | 37,882    |      | $ | 36,448    |  
|Provision   for credit losses                        |  |      | 6,000     |      |   |          |  
|Charge-offs                                          |  |      | (927      | )    |   | (665      | )
|Recoveries                                           |  |      | 1,785     |      |   | 2,099     |  
|                                                     |  |      |           |      |   |           |  
|Balance at December 31                               |  | $    | 44,740    |      | $ | 37,882    |  
|                                                     |  |      |           |      |   |           |  
|Allowance for Loan Losses                            |  | $    | 39,740    |      | $ | 32,882    |  
|Loans, net of unearned   income at December 31       |  | $    | 4,524,511 |      | $ | 2,793,828 |  
|Allowance for Loan Losses as   a percentage of loans |  |      | 0.88      | %    |   | 1.18      | %
|                                                     |  |      |           |      |   |           |  

Charge-offs in 2005 include a $0.5 million charge-off associated with Corus business of servicing the check cashing industry. The charge-off relates to an issue identified in 2002. At that time, Corus identified a control weakness which contributed to charge-offs of nearly $4.9 million of loans and overdrafts in 2002 and 2003. The initial charge-offs were recorded net of estimated recoveries. Various legal delays prevented management from refining the estimate until the fourth quarter of 2005, at which point the additional $0.5 million charge-off was recorded, for a total of $5.4 million. In total, Corus recovered $1.1 million of the $5.4 million charge-off. The remaining recoveries in 2005, 2004 and 2003 related primarily to Corus portfolio of home equity loans. No further material charge-offs related to this matter are anticipated.

Net charge-offs/recoveries for the three years ended December 31 were as follows:

NET (CHARGE-OFF)/RECOVERY DETAIL

|YEARS ENDED DECEMBER 31             |  | 2005 |       | 2004 |   | 2003  |  
|----------------------------------- |  | ---- | ----- | ---- | - | ----- | -
|                                    |  |      |       |      |   |       |  
|(dollars in thousands)              |  |      |       |      |   |       |  
|Commercial  check cashing          |  | $    | (282  | )    | $ | (13   | )
|Commercial  other                  |  |      | (4    | )    |   |      |  
|Residential real estate and   other |  |      | 1,144 |      |   | 1,447 |  
|                                    |  |      |       |      |   |       |  
|Total Net (Charge-offs)/Recoveries  |  | $    | 858   |      | $ | 1,434 |  
|                                    |  |      |       |      |   |       |  

Residential real estate and other recoveries reflect the efforts of the residential real estate department personnel to recover as much as possible of the previously charged off amounts.

CORUS BANKSHARES 2005 ANNUAL REPORT     57

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MANAGEMENTS DISCUSSION and ANALYSISof FINANCIAL CONDITIONandRESULTS of OPERATIONS(Continued)

COMMERCIAL REAL ESTATE LOAN CHARGE-OFFS  10 -YEAR HISTORY

|YEARS ENDED DECEMBER 31 |  | CHARGE-OFFS |    
|----------------------- |  | ----------- | ---
|                        |  |             |    
|(dollars in thousands)  |  |             |    
|2005                    |  | $           | 0  
|2004                    |  |             | 0  
|2003                    |  |             | 0  
|2002                    |  |             | 0  
|2001                    |  |             | 0  
|2000                    |  |             | 0  
|1999                    |  |             | 61 
|1998                    |  |             | 18 
|1997                    |  |             | 350
|1996                    |  |             | 206
|                        |  |             |    
|Total Charge-offs       |  | $           | 635
|                        |  |             |    

Corus has had particularly impressive results with commercial real estate lending. In fact, there have been zero charge-offs in the past six years, and de minimus charge-offs over the past 10 years. However, Corus anticipates that at some point there will be charge-offs relating to its commercial real estate loan portfolio (see Commercial Real Estate Risk Analysis for further discussion of this topic).

PAST DUE, NONACCRUAL, AND RESTRUCTURED LOANS, AND FORECLOSED PROPERTIES

As of December 31, the balances were as follows:

|DECEMBER 31                                                                            |  | 2005 |        | 2004 |  
|-------------------------------------------------------------------------------------- |  | ---- | ------ | ---- | -
|                                                                                       |  |      |        |      |  
|(dollars in thousands)                                                                 |  |      |        |      |  
|Loans 90 days or more past   due                                                       |  | $    | 544    |      | $
|Nonaccrual                                                                             |  |      | 73     |      |  
|Troubled debt restructurings                                                           |  |      | 14,727 |      |  
|                                                                                       |  |      |        |      |  
|Total Past Due, Nonaccrual,   and Restructured Loans                                   |  |      | 15,344 |      |  
|Foreclosed properties                                                                  |  |      |       |      |  
|                                                                                       |  |      |        |      |  
|Total Past Due, Nonaccrual,   and Restructured Loans, and Foreclosed Properties        |  | $    | 15,344 |      | $
|                                                                                       |  |      |        |      |  
|Past due, nonaccrual, and   restructured loans/Total loans                             |  |      | 0.34   | %    |  
|Past due, nonaccrual, and   restructured loans, and foreclosed properties/Total assets |  |      | 0.18   | %    |  
|Allowance for loan   losses/Past due, nonaccrual, and restructured loans               |  |      | 258.99 | %    |  
|                                                                                       |  |      |        |      |  

Total past due, nonaccrual, and restructured loans, and foreclosed properties decreased by $13.9 million to $15.3 million, compared to December 31, 2004. The decrease is primarily due to a loan payoff. Past due, nonaccrual, and restructured loans represent just 0.34% of outstanding loans. The only notable item relates to a $14.7 million hotel loan classified as a Troubled Debt Restructuring (TDR). It should be noted that all payments on this loan have been made timely since inception and the loan is currently in compliance with all terms and conditions, and no loss is expected.

58     CORUS BANKSHARES 2005 ANNUAL REPORT

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POTENTIAL PROBLEM LOANS

In addition to those loans disclosed under the preceding Past Due, Nonaccrual, and Restructured Loans, and Foreclosed Properties section, management identified, through their problem loan identification system, a certain loan in the portfolio which management anticipates restructuring in the first quarter of 2006. The restructuring may result in the loan being classified as a TDR. As of December 31, 2005, the principal amount of the loan was $52.5 million with a total commitment of $54.0 million. Corus does not currently anticipate incurring a loss on this loan.

DEPOSITS

|                                   |  | 2005   |           | 2004    |  | 2005/2004
CHANGE |  
|---------------------------------- |  | ------ | --------- | ------- |  | ---------------- | -
|                                   |  |        |           |         |  |                  |  
|YEARS   ENDED DECEMBER 31          |  | AMOUNT |           | PERCENT |  | AMOUNT           |  
|                                   |  |        |           |         |  |                  |  
|(dollars in thousands)             |  |        |           |         |  |                  |  
|Retail certificates of   deposit   |  | $      | 4,444,539 |         |  | 61               | %
|Money market                       |  |        | 1,640,449 |         |  | 23               |  
|Brokered certificates of   deposit |  |        | 388,969   |         |  | 5                |  
|Demand                             |  |        | 337,399   |         |  | 5                |  
|NOW                                |  |        | 312,220   |         |  | 4                |  
|Savings                            |  |        | 151,770   |         |  | 2                |  
|                                   |  |        |           |         |  |                  |  
|Total                              |  | $      | 7,275,346 |         |  | 100              | %
|                                   |  |        |           |         |  |                  |  

Deposits continued to grow in 2005 resulting in net growth of $3.2 billion for the year ended December 31, 2005. The growth is almost exclusively supported by growth in retail certificates of deposit (CDs) and is the direct result of the Banks national marketing of selected deposit accounts to both individuals and businesses at market-leading rates. The response to this program, which was introduced in April 2004, continues to be strong both locally and across the country. These deposit products, particularly CDs with six- and twelve-month maturities, have proven to be an attractive investment option for many new and existing customers. As of December 31, 2005, approximately $4.4 billion in retail certificates of deposit nature in under one year compared to $1.2 billion at December 31, 2004.

The retention of existing deposits continues to be a major focus of the Bank. While the results to date have been encouraging, there are no guarantees that account retention will remain high over the long term.

At December 31, 2005, approximately 60% of the Banks $6.9 billion in retail deposits (excluding brokered deposits) were sourced from outside of Illinois. By marketing its deposit products nationally, the Bank is able to attract deposits without being limited to competing solely in the very competitive Chicago market. Total retail deposits consisted of approximately 160,000 accounts.

Demand deposits have also grown in 2005, increasing by over 43%. While this increase is significant, no new deposit products were introduced during the year, nor were any significant changes made to the marketing of existing products. Instead, the cause of the increase was due mainly to higher than usual account balances at year-end.

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MANAGEMENTS DISCUSSION and ANALYSISof FINANCIAL CONDITIONandRESULTS of OPERATIONS(Continued)

LONG-TERM DEBT  SUBORDINATED DEBENTURES

Corus has formed eleven wholly-owned
unconsolidated finance subsidiaries (the Trusts) for the sole
purpose of issuing what are commonly referred to as Trust Preferred securities.
Trust Preferred securities are a very common form of raising tax-advantaged
capital, especially for bank holding companies. While the legal structure of
Trust Preferred securities is quite complicated, both the essence of these
securities and the basis for Corus decision to utilize them are actually
quite straightforward. Trust Preferred securities are essentially long-term debt
(30-year terms) with some unique features.

The Trusts sold a combined $347.5 million of Trust Preferred securities via a private placement, the proceeds of which were lent to the Company and secured by subordinated debentures (the Debentures) (subordinate to all other debt of the Company but senior to common stock) issued by the Company to the Trusts totaling $358.3 million  the difference being Corus investment in the Trusts. The majority of the funds raised by the issuance of the Trust Preferred securities were, in turn, infused into the Bank as additional capital. Note that the terms for both the Trust Preferred securities and the Debentures are essentially identical.

Corus has the
right to defer distributions on the Trust Preferred securities and interest
payments on the subordinated Debentures for a period not to exceed 20
consecutive quarters. If Corus were to elect to defer interest on any of the
Debentures, Corus would generally be restricted from declaring or paying any
dividends to common shareholders or repurchasing its common stock. Additionally,
Corus would not be permitted to make any payments of principal or interest on,
or to repay/redeem, any debt securities that are of equal rank with (i.e., pari
passu), or are junior to, the Debentures. In other words, if Corus were to elect
to defer interest payments on any one of the Debentures, Corus would be required
to defer all payments with respect to all of its Debentures. It should be noted
that this provision was not negotiated by Corus, but rather is a standard and
required feature of Trust Preferred securities in order for the Federal Reserve
to allow such instruments to be counted in capital at the bank holding company.

Finally, as cited above, Trust Preferred securities have several unique attributes. One of the most notable, and the key to the widespread issuance of Trust Preferred securities, is that the Federal Reserve allows bank holding companies to include, up to certain limits, Trust Preferred securities in the regulatory calculation of capital while providing the issuer with a tax deductible funding vehicle. In addition, Trust Preferred securities are not puttable back to Corus and include an option for Corus to call them at par beginning five years after issuance and quarterly thereafter (or earlier in the event of certain changes or amendments to regulatory requirements or federal tax rules).

Combined issuance fees for the Trust Preferred securities totaled $1.6 million and are being amortized over their respective 30-year lives. Corus has, through various agreements, essentially fully and unconditionally guaranteed payment of all amounts due under the Trust Preferred securities.

The Debentures include interest rates ranging from LIBOR plus 1.33% to LIBOR plus 3.10%, resetting quarterly.

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OTHER BORROWINGS

As of December 31, 2005, other borrowings consisted primarily of a revolving line of credit for up to $100 million at an interest rate of LIBOR plus 140 basis points. In addition, a fee at an annual rate of 25 basis points of the average unused commitment is due quarterly. The line of credit matures on November 30, 2008, and is collateralized by 100% of the common stock of the subsidiary bank. The balance outstanding at December 31, 2005, was $19.2 million. This line of credit is intended to provide the holding company with the necessary financing to fund those loans in which it has purchased a participation from its subsidiary bank.

The remaining amount outstanding at December 31, 2005, of $2.4 million relates to periodic balances associated with Corus role of facilitating tax payments for the U.S. Treasury. The balance outstanding at any point in time is a function of tax payments received by the bank compared to how often, and when, the Treasury collects the funds from Corus. Corus pays interest on these borrowings at the Federal Funds Rate less 25 basis points.

SHAREHOLDERS EQUITY

At December 31, 2005 and 2004, Shareholders Equity was as follows:

|DECEMBER 31                              |  | 2005 |         | 2004 |  
|---------------------------------------- |  | ---- | ------- | ---- | -
|                                         |  |      |         |      |  
|(dollars in thousands)                   |  |      |         |      |  
|Common stock                             |  | $    | 1,396   |      | $
|Surplus                                  |  |      | 27,278  |      |  
|Equity  options outstanding             |  |      | 7,770   |      |  
|Retained earnings                        |  |      | 609,334 |      |  
|Accumulated other   comprehensive income |  |      | 43,997  |      |  
|                                         |  |      |         |      |  
|Total Shareholders Equity               |  | $    | 689,775 |      | $
|                                         |  |      |         |      |  

During 2005, Corus repurchased and retired 31,800 shares of common stock at an average price of $54.94 per share. These repurchases were made under a common share repurchase program approved by the Board of Directors in April 2004, which authorized the repurchase of up to 1,000,000 shares. As of December 31, 2005, there were 842,700 remaining shares authorized for repurchase under this program.

Surplus increased by $6.0 million primarily due to the impact of Corus employees who exercised stock options during the year, which increased surplus by $3.5 million. Additionally, under the CLO Program, a portion of the commissions earned is held back, some in Corus common stock. Holdbacks in stock are initially recorded as additional surplus. Upon issuance, the par value of the stock is reclassified to common stock. CLO Program stock holdbacks in 2005 totaled $1.7 million.

The increase in Equity  options outstanding was primarily due to the recognition of expense associated with employee stock options that vested in 2005. The balance of the account at December 31, 2005, represents the fair value, based on the Black-Scholes valuation model, of all outstanding vested stock options.

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MANAGEMENTS DISCUSSION and ANALYSISof FINANCIAL CONDITIONand RESULTS of OPERATIONS(Continued)

Retained earnings increased by $96.5 million even after declaring approximately $39 million in dividends to the holders of Corus common stock. Dividends declared in 2005 were 12% higher than in 2004.

Finally, accumulated other comprehensive income decreased by $13.4 million as $12.7 million in previously unrealized security gains on available-for-sale securities were recognized in income. Please refer to the Noninterest Income section of Managements Discussion and Analysis of Financial Condition and Results of Operations for a discussion of the GAAP treatment of security gains.

Various measures of capital were as follows:

|                             |  | 2005   |           | 2004  | 
|---------------------------- |  | ------ | --------- | ----- | 
|                             |  |        |           |       | 
|DECEMBER 31                  |  | AMOUNT |           | RATIO | 
|                             |  |        |           |       | 
|(dollars   in thousands)     |  |        |           |       | 
|Common equity(1)             |  | $      | 689,775   |       | 
|Tangible common equity(2)    |  |        | 685,252   |       | 
|Tier 1 leverage(3)           |  |        | 855,006   |       | 
|Tier 1 risk-based capital(4) |  |        | 855,006   |       | 
|Total risk-based capital(5)  |  |        | 1,067,032 |       | 
|                             |  |        |           |       | 

|(1) | Common   equity is computed in accordance with generally accepted accounting   principles, which includes unrealized gains/(losses) on available-for-sale   securities.The ratio is common equity to total year-end assets.                                                                                                          
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) | Common   equity less goodwill; computed as a ratio to total year-end assets less goodwill.                                                                                                                                                                                                                                           
|(3) | Tier 1 capital, which is shareholders equity less goodwill, disallowed portion of deferred income taxes and unrealized gains on available-for-sale securities; computed as a ratio to average fourth-quarter assets less goodwill, disallowed portion of deferred income taxes and unrealized gains on available-for-sale securities.
|(4) | Tier 1   capital; computed as a ratio to risk-adjusted assets.                                                                                                                                                                                                                                                                       
|(5) | Tier 1   capital plus qualifying loan loss allowance and SFAS 115 gain; computed as a   ratio to risk-adjusted assets.                                                                                                                                                                                                               

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|LIQUIDITY   AND CAPITAL RESOURCES
|---------------------------------
|                                 

Corus liquidity policy is to ensure the availability of sufficient funds to accommodate the needs of borrowers and depositors at all times as well as meeting Corus financial obligations. This objective is achieved primarily through the maintenance of liquid assets. Liquid assets include cash and cash equivalents, federal funds sold, and marketable securities that can be sold quickly without a material loss of principal.

BANK HOLDING COMPANY

At December 31, 2005, the parent company had $208.3 million of cash and marketable securities compared to $225.6 million one year earlier.

SourcesOver the past several years, the parent companys main source of cash has been the issuance of a unique form of long-term debt. These debt instruments are commonly referred to as Trust Preferred securities. The Trust Preferred securities are actually issued by Corus unconsolidated subsidiary trusts, the proceeds of which are used to purchase Debentures from Corus with terms comparable to the Trust Preferred securities. This debt appears on Corus financial statements as Long-Term Debt  Subordinated Debentures. Please refer to the Long-Term Debt  Subordinated Debentures section of Managements Discussion and Analysis of Financial Condition and Results of Operations for a more detailed discussion of these securities.

The pooling structure available for Trust Preferred securities (where a group of 25 or more banks issue concurrently into one larger pool) has allowed Corus to access the capital markets even though it currently has no debt ratings or ratings outlook from any of the major ratings agencies. To the extent that the Banks total loans outstanding grow, it is likely, based on managements internal capital goals, that the Company would seek to issue additional Trust Preferred securities in the future. While this has been a reliable source of capital in the recent past, there is no assurance that it will be available to Corus going forward.

All of the outstanding Trust Preferred securities, as well as the associated Debentures, are variable-rate and, as such, management cannot say with certainty what the interest payments on the Debentures, and as a result, the distributions on the Trust Preferred securities, will be in the future. However, based on December 31, 2005, market interest rates, the distributions to holders of Corus Trust Preferred securities would be approximately $25 million per annum. To the extent the Company issues more Trust Preferred securities and/or short-term interest rates increase from year-end 2005 levels, the associated interest expense could be materially greater.

One aspect of
the Trust Preferred securities and the Debentures that warrants further
discussion here as it relates to Corus liquidity, is a provision that
allows for deferral of interest payments on the Debentures, and in turn, the
distributions on the Trust Preferred securities, for up to five consecutive
years without triggering an event of default (this provision is subject,
however, to certain restrictions with regard to Corus ability to make,
among other things, dividends, distributions, etc. to holders of Corus common
stock).

Prior to issuing Trust Preferred securities, the parent companys main source of cash had been dividends from the Bank. However, more recently, the Bank has experienced tremendous growth in loans and total assets, which has resulted in an increase in the Banks capital goals. Because the growth in the Banks capital goals has outpaced the earnings of the Bank, dividends from the Bank have not been a main source of cash to the parent company during this period and, in fact, the parent has infused cash into the Bank.

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MANAGEMENTS DISCUSSION and ANALYSISof FINANCIAL CONDITIONandRESULTS of OPERATIONS(Continued)

In general the Banks ability to pay dividends to the parent company is dependent on its ability to generate earnings and to meet various regulatory restrictions. At December 31, 2005, the Bank had $180.7 million available to pay in dividends to the parent company without prior regulatory approval while maintaining capital levels that would be classified as well capitalized by the banking regulators. Well capitalized is the highest capital classification as defined by the regulators (see below note regarding Regulatory Well-Capitalized Classification for further information). In addition, management has set capital goals for the Bank that exceed regulatory minimums. In other words, management might not pay dividends from the Bank although it would be allowed to do so by regulators.

Additional sources of liquidity available to the parent company include dividends from its equity securities portfolio, interest and fees earned from loan participations, and cash that could be generated from sales of equity securities.

Regulatory Well-Capitalized ClassificationThe Banks capital classification is determined solely for the purpose of applying PCA, hereinafter defined. The Federal Deposit Insurance Corporation Improvement Act of 1991 (Act), a major overhaul in the laws and regulations governing banks, introduced many new legal and regulatory frameworks. Some of the more significant aspects of the Act are the provisions collectively referred to as Prompt Corrective Action (PCA). The PCA provisions were motivated by a Congressional desire to reduce the potential for future regulatory/supervisory forbearance and, hopefully, failure costs in the banking industry. What this means, among other things, is that banking regulators have the legal authority to reduce the capital classification of a bank below what the numerical capital ratios would otherwise indicate. That is, the Banks capital classification is
determined solely for the purpose of applying PCA and that classification may not constitute an accurate representation of the Banks overall financial condition or prospects.

UsesDuring the last few years, one of the parent companys primary uses of cash has been infusions into the Bank. These infusions, which have increased the Banks equity and thus capital, have supported the Banks growth. The increased capital has, in turn, given rise to an increase in the Banks legal lending limit, allowing the Bank to make larger commercial real estate loans.

Other major uses of cash at the parent company include the payment of dividends to shareholders, interest and principal payments on debt, share repurchases, and the payment of operating expenses.

Finally, the parent company requires cash to fund loan participations entered into with the Bank for loans that exceed the Banks legal lending limit. As of December 31, 2005, the parent company had committed to $50.2 million of loan participations with the Bank, $30.2 million of which were unfunded at that time. In order to fund these commitments, should funding be required, the parent company would draw on its $100 million line of credit (see Note 8 of the Notes to Consolidated Financial Statements).

SUBSIDIARY BANK

At December 31, 2005, the Banks liquid assets totaled $3.7 billion, or 44.6%, of its total assets versus $2.0 billion, or 41.0% of total assets at December 31, 2004.

SourcesManagement currently anticipates that the its primary sources of cash will be (not necessarily listed in order of priority): normal paydowns on the existing loan portfolio, the liquidation of existing investment securities, net retail deposit growth (to the extent such occurs), Bank earnings not paid to the parent company as a dividend, capital infusions, and the issuance of additional brokered certificates of deposit (BRCDs). Corus ability to issue BRCDs in the future could be limited if, among other reasons, the Bank were to experience credit problems or fail to maintain its well-capitalized status.

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UsesThe Banks current principal use of cash is to fund commercial real estate loans, both new loans as well as drawdowns of existing unfunded loan commitments. At December 31, 2005, the Bank had unfunded commercial real estate loan commitments of $3.9 billion. While there is no certainty as to the timing of drawdowns of these commitments, management anticipates the majority of the loan commitments will fund over the next 36 months, although such fundings could occur more rapidly.

In addition to funding commercial real estate loans, the Bank must retain sufficient funds to satisfy depositors withdrawal needs and cover operating expenses. Recently, the Bank has experienced significant deposit growth, primarily from retail certificates of deposit (CDs) with maturities of one year or less. These new deposits, as a result of their short-term nature, present greater liquidity risk than do longer term funding options. While the deposit growth has been very strong, deposits could shrink in the future, perhaps materially, and the Bank must stand ready to fund the withdrawals. Towards that end, the Bank internally allocates a substantial pool of its investment securities (Liquidity) against deposits. Liquidity is allocated against retail deposits in total rather than attempting to assign different liquidity levels by product type, maturity, or other
factors.

OFFBALANCE SHEET ARRANGEMENTS

As of the date of this report, Corus has no offbalance sheet arrangements, as defined by Securities and Exchange Commission Regulation S-K Item 303(a)(4).

CONTRACTUAL OBLIGATIONS AND COMMITMENTS

The following table presents Corus contractual obligations as of December 31, 2005:

|                                           |  | PAYMENTS DUE BY PERIOD |          
|------------------------------------------ |  | ---------------------- | ---------
|                                           |  |                        |          
|CONTRACTUAL OBLIGATIONS                    |  | LESS THAN   1 YEAR     |          
|                                           |  |                        |          
|(in thousands)                             |  |                        |          
|Deposits without a stated   maturity       |  | $                      | 2,441,838
|Certificates of deposit                    |  |                        | 4,497,551
|Long-term debt    subordinated debentures |  |                        |         
|Other borrowings                           |  |                        | 2,443    
|Minimum fixed lease   obligations          |  |                        | 420      
|Purchase obligations                       |  |                        | 920      
|                                           |  |                        |          
|Total Contractual   Obligations            |  | $                      | 6,943,172
|                                           |  |                        |          

Corus had the following lending commitments as of December 31, 2005:

|                                           |  |   |           | 
|------------------------------------------ |  | - | --------- | 
|(in thousands)                             |  |   |           | 
|Standby letters of credit                  |  | $ | 12,093    | 
|Commitments letters   outstanding          |  |   | 399,872   | 
|Unused commitments under   lines of credit |  |   | 3,543,027 | 
|                                           |  |   |           | 
|Total Commitments   Outstanding            |  | $ | 3,954,992 | 
|                                           |  |   |           | 

Refer to Note 12 in the Notes to Consolidated Financial Statements for additional detail.

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MANAGEMENTS DISCUSSION and ANALYSISof FINANCIAL CONDITIONandRESULTS of OPERATIONS(Continued)

|MARKET   RISK MANAGEMENT
|------------------------
|                        

Corus operations are subject to risk resulting from interest rate fluctuations to the extent that there is a difference between the amount of interest-earning assets and the amount of interest-bearing liabilities that are prepaid/withdrawn, mature, or reprice in specified periods. The principal objective of Corus asset/liability management activities is to provide maximum levels of net interest income while maintaining acceptable levels of interest rate and liquidity risk. Corus uses an interest rate sensitivity model as the primary quantitative tool in measuring the amount of interest rate risk that is present at the end of each quarter. The model simulates earnings under a variety of interest rate scenarios to quantify the effect of potential movements in interest rates on projected net interest income. These simulations incorporate managements assumptions regarding the future composition of the balance sheet, which may include loan and
deposit growth. Also factored into the modeling is the use of derivative financial instruments, which may include basis swaps, interest rate swaps, floors, and options.

Virtually all of the Banks assets are either floating rate, generally based on short-term interest rates (e.g., 3-month LIBOR) and resetting quarterly, or short-term, generally maturing within the next few years. The Banks liabilities are very similar in nature, with the exception of demand deposits, which are effectively fixed at a zero percent interest rate, and the administered-rate deposits that do not reprice in lock-step with such changes in short-term interest rates (essentially, NOW and Savings accounts). The remaining component is shareholder equity. From an accounting perspective, and hence an interest rate risk sensitivity perspective, equity acts as zero percent fixed-rate funding.

The combination of shareholder equity, along with the demand and administered-rate deposits, is substantially greater than the few Bank assets that are long-term fixed-rate or noninterest-earning (primarily common stock portfolio, cash, fixed-rate loans, and fixed assets). As of December 31, 2005 that difference was roughly $800 million. As a result, during times of changing interest rates (in Corus case, short-term interest rates), this would give rise to more assets repricing than liabilities repricing. This is therefore referred to, in banking parlance, as being asset sensitive.

As a result of its asset sensitive position, the Bank generally expects that increases in short-term interest rates will result in an increase of the Banks net interest income. Conversely, it is generally anticipated that decreases in short-term interest rates will result in a decrease in the Banks net interest income.

In order to gauge the Banks sensitivity to changes in short-term interest rates, management calculates the potential impact that changes in interest rates would have on the Banks net interest income over the next calendar year. For purposes of modeling simplicity, it is common for banks to use immediate changes in interest rates. Further, these changes are assumed to occur across the entire yield curve. In order words, a 0.50% increase in interest rates (which  as a matter of convention  is listed as 50 basis points, or 50bp) means that the Banks models assume that yields increase by 0.50% at 3 months, 1 year, 2 years, etc., all the way out to the 30 year point of the curve. These types of immediate and parallel shifts are commonly referred to as interest rate shocks.

It should be noted that that while using such shocks to gauge interest rate risk is standard industry practice, interest rate changes of this sort are in fact very unlikely to occur. As most banks have a diverse mix of fixed versus floating assets and liabilities, with potentially vastly different maturity structures, such a simplistic assumption is quite problematic. Fortunately, as the vast preponderance of the Banks assets and liabilities are floating rate and reset, either directly or indirectly, off of very short-term interest rates, this simplistic assumption is actually quite reasonable for Corus. The only exception, and in the range of interest rate shocks shown below, it is a rather modest one, results from the interest rate floors management has negotiated in many of its floating-rate CRE loans.

Simply put, these interest rate floors set a minimum rate on the loan regardless of how much the underlying index falls (the floor rate is a negotiable term of the loans and therefore varies from loan to loan). Stated differently, the interest rate floor effectively fixes the rate of the loan if short-term rates were to fall to a

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sufficiently low level. Whenever the floor rate is greater than the calculated rate of the loan, and thus becomes the effective rate on the loan, the interest rate floor is said to be in-the-money. Currently none of the CRE loan floors are in-the-money. However, if short-term rates were to decline sufficiently, the interest rate floors would help mitigate the downside risk in having an otherwise asset sensitive balance sheet. This benefit can be seen in the scenario below where interest rates have fallen by 200bp.

The table below, which reflects the interest risk positions as of December 31, 2005, and December 31, 2004, illustrates the Banks asset-sensitive positions under all interest rate shock scenarios. When reviewing the table below, it is important to understand that the various changes in interest rates shown are potential changes to the level of short-term interest rates that were prevailing as of each year-end. That is, a 100bp increase in rates for one time period could represent a very different interest rate scenario than another. For example, the 3-month T-Bill yield at December 31, 2005, was approximately 4.00% versus 2.30% at December 31, 2004. Therefore, a 100bp increase in rates would result in a 3-month T-Bill of 5.00% for the December 31, 2005, simulations versus 3.30% for those from December 31, 2004.

Interest rate sensitivity was as follows:

|Rate Shock   Amount(1)                                                              |  | 200 bp |      | 100 bp |  | 50 bp |    | 0 bp |      | +50 bp |  | +100 bp |   | +200 bp |     | +300 bp | 
|----------------------------------------------------------------------------------- |  | ------- | ---- | ------- |  | ------ | -- | ---- | ---- | ------ |  | ------- | - | ------- | --- | ------- | 
|                                                                                    |  |         |      |         |  |        |    |      |      |        |  |         |   |         |     |         | 
|Percent change in the next   twelve months net interest income vs. constant rates: |  |         |      |         |  |        |    |      |      |        |  |         |   |         |     |         | 
|December 31, 2005                                                                   |  |         | (2.0 | )%      |  | (4.0   | )% |      | (2.3 | )%     |  |        |   |         | 2.3 | %       | 
|December 31, 2004                                                                   |  |         | NM   | (2)     |  | (0.7   | )% |      | (1.7 | )%     |  | 0.0     | % |         | 2.7 | %       | 
|                                                                                    |  |         |      |         |  |        |    |      |      |        |  |         |   |         |     |         | 

|(1) | These   shocks represent hypothetical instantaneous and sustained changes from   current rates.
|--- | -------------------------------------------------------------------------------------------------
|(2) | Not   meaningful due to the low level of interest rates at December 31, 2004.                    

For all rising rate shocks, and as gauged by the percentage changes in net interest income, the Banks projected asset-sensitivity has decreased since December 31, 2004. While the projected absolute dollar changes in net interest income have increased period-over-period, the projected net interest income under the stable scenario has increased by a proportionately greater amount. As a result, the percentage differences between the stable and positive rate shocks have decreased.

For falling rate shocks of 50bp and 100bp, and as gauged by the percentage changes in net interest income, projected asset-sensitivity has increased slightly resulting in a larger projected drop in net interest income compared to stable rates. This change was caused by the reduced impact of CRE loan floors. At current interest rate levels, the floors are further out-of-the-money and have less of an impact across the range of rate shocks presented.

For a falling rate shock of 200bp (this scenario was not run at December 31, 2004, and therefore cannot be compared to current results), and as gauged by the percentage changes in net interest income, the Bank is asset-sensitive but less so than under a 100bp decrease. This reduction in sensitivity relative to a 100bp decrease is due to the greater impact of CRE loan floors in lower rate environments. To clarify, the vast majority of CRE loans have embedded floors and, while none are in-the-money at current rates, most would be in-the-money given a drop in short-term rates of 200bp  reducing the Banks downside risk.

Corus is also exposed to price risk with its common stock portfolio in financial industry companies valued at $184.5 million as of December 31, 2005, including net unrealized gains of $74.0 million. This price risk would impact the net income of Corus, in the form of securities losses, should unrealized losses on individual securities be determined to be other than temporary. This price risk would also affect any future gains or losses that may be realized upon the sale of certain equity securities or resulting from mergers/acquisitions of any companies held in the portfolio.

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MANAGEMENTS DISCUSSION and ANALYSISof FINANCIAL CONDITION andRESULTS of OPERATIONS(Continued)

|COMMERCIAL   REAL ESTATE RISK ANALYSIS
|--------------------------------------
|                                      

The following disclosure is not computed in accordance with generally accepted accounting principles (GAAP) and is considered a non-GAAP disclosure. Management believes that this presentation, while not in accordance with GAAP, provides useful insight into how management analyzes and quantifies risk and determines the appropriate level of capital.

Management has made a concerted effort to distill the numerous objective, as well as subjective, risks inherent in the commercial real estate (CRE) loans the Bank originates into a rigorous system to analyze and quantify risk. At its core, this system takes the form of management and loan officers estimating a loans Probability of Default (POD) and its Loss Given Default (LGD) if a serious recession should occur. The POD is our estimate of how likely it is, given a serious recession, a loan would go into default while the LGD is our estimate, given such a default, of what percentage of the loan would have to be charged off. This point bears repeating  the POD and LGD estimates are not based on todays market conditions; they are instead arrived at by stressing all major assumptions regarding the cash flow and/or values of the underlying real


estate down to levels that could manifest themselves during a serious recession. Management believes that assessing the impact that a severe recession would have on the portfolio is the best method to truly stress the portfolio.

As a proxy for the potential cash flow and/or values of the underlying real estate, management uses, among other things, the severe declines in CRE property values experienced in California and New England during the late 1980s and early 1990s. The analysis assumes, based on information collected from various regulatory and industry sources, that condominiums will be worth 60% to 80% of cost (not appraised value). Keep in mind that while these are the typical discounts, each loan is analyzed individually and may have discounts larger or smaller than mentioned above. Additionally, while this system of analysis is based on a serious recession, it is certainly possible that the Company could experience meaningful nonperforming loans and charge-offs even in the absence of such a recession.

While Corus has attempted to be conservative in its assessment of potential defaults and losses, it is conceivable that actual defaults and/or losses may be greater, perhaps materially, than estimated. Note that this analysis is not predicated upon when, or how often, serious recessions may occur, but rather upon the anticipation of such events.

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Following is a table that summarizes the total size of our CRE loan portfolio, the weighted average POD and LGD percentages, and the resulting implied CRE loans that could default and losses that could occur.

|DECEMBER 31                                        |  | 2005 |       | 2004 |  
|-------------------------------------------------- |  | ---- | ----- | ---- | -
|                                                   |  |      |       |      |  
|(dollars in millions)                              |  |      |       |      |  
|CRE LOANS   & UNFUNDED COMMITMENTS                 |  |      |       |      |  
|CRE loans outstanding                              |  | $    | 4,404 |      | $
|Unfunded commitments                               |  |      | 3,936 |      |  
|                                                   |  |      |       |      |  
|CRE   Loans Plus Unfunded Commitments              |  | $    | 8,340 |      | $
|                                                   |  |      |       |      |  
|POTENTIAL   DEFAULTS & LOSSES                      |  |      |       |      |  
|CRE loans plus unfunded   commitments              |  | $    | 8,340 |      | $
|Weighted average Probability   of Default (POD)(1) |  |      | 16    | %    |  
|                                                   |  |      |       |      |  
|Potential   CRE Loans That Could Default           |  | $    | 1,341 |      | $
|Weighted average Loss Given   Default (LGD)(1)     |  |      | 18    | %    |  
|                                                   |  |      |       |      |  
|Potential   Losses That Could Occur                |  | $    | 239   |      | $
|                                                   |  |      |       |      |  
|NONPERFORMING   LOANS                              |  |      |       |      |  
|Potential CRE loans that   could default           |  | $    | 1,341 |      | $
|Potential losses that could   occur                |  |      | (239  | )    |  
|                                                   |  |      |       |      |  
|Potential   Remaining CRE Nonperforming Loans      |  | $    | 1,102 |      | $
|                                                   |  |      |       |      |  

|(1) | The POD   and LGD estimates are not based on todays market conditions; they are   instead arrived at by stressing all major assumptions regarding the cash   flow and/or values of the underlying real estate down to levels that could   manifest themselves during a serious recession.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

The internal loan rating system projects that under a stress scenario, the Bank could have $1.3 billion of defaulted CRE loans and $239 million of these loans could be charged off. These are large figures, however it is essential to understand that the Bank underwrites all of its CRE loans with the potential for such a recession in mind. The Bank factors in such an economic loss expense, based on each loans particular attributes, when underwriting all CRE loans. While the Bank has yet to experience a large amount of nonperforming loans or charge-offs, our planning anticipates that it will occur and we have already factored this potential cost into the profitability of our loans.

Note that while the POD and LGD percentages are slightly higher than last years figures, rounding has exaggerated the actual change. Further, please note that while this internal loan rating system generates very precise numbers, and management has worked hard to arrive at inputs we believe reasonable, this precision is more a function of the mathematical nature of the model than a belief on our part that future results can be predicted with any such certainty. This model, like all models, requires numerous assumptions and, in this case, assumptions about how vulnerable each and every individual loan will be to a serious recession at some unknown point in the future. While the results reflect our best estimates, the actual level of nonperforming loans and charge-offs that may ultimately come to pass could be materially different from these projections.

CORUS BANKSHARES 2005 ANNUAL REPORT     69

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MANAGEMENTS DISCUSSION and ANALYSISof FINANCIAL CONDITIONandRESULTS of OPERATIONS(Continued)

|CRITICAL   ACCOUNTING POLICIES
|------------------------------
|                              

ALLOWANCE FOR CREDIT LOSSES

The Allowance for Credit Losses is comprised of the Allowance for Loan Losses and a separate Liability for Credit Commitment Losses. The Allowance for Loan Losses is a reserve against funded loan amounts, while the Liability for Credit Commitment Losses relates to those amounts that Corus is committed to lend but for which funds have not yet been disbursed.

The Allowance for Loan Losses analysis is prepared on a quarterly basis. The methodology is designed to first provide for specific reserves associated with impaired loans. As defined by Statement of Financial Accounting Standards No. 114, Accounting by Creditors for Impairment of a Loan, a loan is impaired when, based on current information and events, it is probable that a creditor will be unable to collect both the interest payments and the principal payments of a loan due according to the contractual terms of the loan agreement. Management primarily uses the loan rating system prescribed by the Office of the Comptroller of the Currency (the OCC) to select loans for impairment assessment. Loans determined to be impaired are segregated from the remainder of the portfolio and are subjected to a specific review in an effort to determine whether or not a specific reserve is
necessary.

A general reserve is calculated for the remainder of the portfolio. The portfolio is first segmented into subcategories of like-kind loans. Corus will segment the loans as follows:

| | Commercial real estate   loans                                                                                   
|- | -----------------------------------------------------------------------------------------------------------------
|  | (which may be further   broken down into, among other categories, construction, non-construction and   mezzanine)
|  |                                                                                                                  
| | Commercial loans                                                                                                 
|  |                                                                                                                  
| | Overdrafts                                                                                                       
|  |                                                                                                                  
| | Residential loans                                                                                                
|  |                                                                                                                  
| | Student/Other loans                                                                                              

The general reserve is calculated as a percentage (the Reserve Percentage) of the outstanding balance of each of the above-listed segments. The Reserve Percentage is based on a historic charge-off percentage (if a net recovery, then zero) adjusted by a Management Adjustment Factor (MAF). The MAF is based on the trends of various objective and subjective factors. These factors, which are not all weighted equally, may change over time as the portfolio changes. The factors considered include the level and direction of nonperforming and adversely rated loans, the overall breakdown of the portfolio (collateral type and location), and managements perception of the current state of the economy.

The process for estimating the Liability for Credit Commitment Losses closely follows the process outlined above for the Allowance for Loan Losses. The primary difference is that the Reserve Percentage is adjusted to account for the lower risk associated with unfunded amounts combined with the expected timing and likelihood of funding.

The assessment as to the adequacy of the Allowance is grounded by the assumption that historical experience is a good indicator of inherent losses. This assumption, while supported by guidance provided by the Financial Accounting Standards Board (FASB), the OCC, and the Securities and Exchange Commission, may not ultimately be correct. In that event, estimates of inherent losses may differ materially from actual results.

70CORUS BANKSHARES 2005 ANNUAL REPORT

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|FORWARD-LOOKING   STATEMENTS
|----------------------------
|                            

This disclosure contains forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by, among other things, the use of forward-looking terms such as likely, typically, may, intends, expects, anticipates, estimates, projects, targets, forecasts, seeks, or attempts or the negative of such terms or other variations on such terms or comparable terminology. By their nature, these statements are subject to risks, uncertainties, and other factors which could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. Important factors that might cause Corus actual results to differ materially include, but are not limited to, the following:

| | The general   state of the economy, particularly continued strength in the residential real   estate sector. Weakness in the residential real estate sector, which may be   caused by, among many other things, higher interest rates, could adversely   affect: 1) Corus ability to maintain its current level of loan originations,   and/or 2) the credit quality of outstanding loans.
|- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  |                                                                                                                                                                                                                                                                                                                                                                                            
| | The impact   of competitors pricing initiatives on loan and deposit products.                                                                                                                                                                                                                                                                                                             
|  |                                                                                                                                                                                                                                                                                                                                                                                            
| | The timing   of drawdowns on unfunded loan commitments and paydowns of existing loans.                                                                                                                                                                                                                                                                                                     
|  |                                                                                                                                                                                                                                                                                                                                                                                            
| | Corus   ability to attract and retain sufficient cost-effective funding to support   marginal loan growth.                                                                                                                                                                                                                                                                                
|  |                                                                                                                                                                                                                                                                                                                                                                                            
| | Corus   ability to access the capital markets, particularly for the issuance of Trust   Preferred Securities.                                                                                                                                                                                                                                                                             
|  |                                                                                                                                                                                                                                                                                                                                                                                            
| | Corus   ability to maintain and access any line(s) of credit.                                                                                                                                                                                                                                                                                                                             
|  |                                                                                                                                                                                                                                                                                                                                                                                            
| | The extent   of defaults and losses given default and how those results compare to Corus   estimates.                                                                                                                                                                                                                                                                                     
|  |                                                                                                                                                                                                                                                                                                                                                                                            
| | Changes in   managements estimate of the adequacy of the allowance for credit losses.                                                                                                                                                                                                                                                                                                     
|  |                                                                                                                                                                                                                                                                                                                                                                                            
| | Restrictions   that may be imposed by any of the various regulatory agencies that have   authority over the Company or any of its subsidiaries.                                                                                                                                                                                                                                            
|  |                                                                                                                                                                                                                                                                                                                                                                                            
| | The   occurrence of one or more catastrophic events, such as an earthquake,   hurricane, or acts of terrorism that affect properties securing the loans.                                                                                                                                                                                                                                   
|  |                                                                                                                                                                                                                                                                                                                                                                                            
| | Changes in   the accounting policies, laws, regulations, and policies governing financial   services companies.                                                                                                                                                                                                                                                                            

Corus undertakes no obligation to revise or update these forward-looking statements to reflect events or circumstances after the date of this report.

CORUS BANKSHARES 2005 ANNUAL REPORT     71

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SUPPLEMENTAL FINANCIAL DATA: 10-YEAR HISTORY

|YEARS ENDED DECEMBER 31                                       |  | 2005 |           | 2004 |   | 2003      |   | 2002 |          
|------------------------------------------------------------- |  | ---- | --------- | ---- | - | --------- | - | ---- | ---------
|                                                              |  |      |           |      |   |           |   |      |          
|(dollars in thousands, except per share   data)               |  |      |           |      |   |           |   |      |          
|CONDENSED   INCOME STATEMENTS                                 |  |      |           |      |   |           |   |      |          
|Net   interest income                                         |  | $    | 249,658   |      | $ | 151,464   |   | $    | 123,427  
|Provision   for credit losses                                 |  |      | 6,000     |      |   |          |   |      |         
|Noninterest   income                                          |  |      | 27,949    |      |   | 51,415    |   |      | 16,920   
|Noninterest   expense                                         |  |      | 61,322    |      |   | 56,273    |   |      | 52,533   
|                                                              |  |      |           |      |   |           |   |      |          
|Income   Before Income Taxes                                  |  |      | 210,285   |      |   | 146,606   |   |      | 87,814   
|Income   tax expense                                          |  |      | 73,056    |      |   | 48,667    |   |      | 29,404   
|                                                              |  |      |           |      |   |           |   |      |          
|Net Income                                                    |  | $    | 137,229   |      | $ | 97,939    |   | $    | 58,410   
|                                                              |  |      |           |      |   |           |   |      |          
|SELECTED   PER SHARE DATA (1)                                 |  |      |           |      |   |           |   |      |          
|Diluted   earnings                                            |  | $    | 4.76      |      | $ | 3.40      |   | $    | 2.04     
|Cash   dividends declared on common stock                     |  |      | 1.400     |      |   | 1.250     |   |      | 0.830    
|Book   value at year-end                                      |  |      | 24.70     |      |   | 21.57     |   |      | 19.48    
|Market   price at year-end                                    |  |      | 56.27     |      |   | 48.01     |   |      | 31.02    
|                                                              |  |      |           |      |   |           |   |      |          
|AVERAGES                                                      |  |      |           |      |   |           |   |      |          
|Assets                                                        |  | $    | 6,648,237 |      | $ | 4,050,352 |   | $    | 2,984,021
|Loans,   net of unearned income                               |  |      | 3,551,877 |      |   | 2,461,790 |   |      | 2,000,505
|Earning   assets                                              |  |      | 6,522,428 |      |   | 3,953,325 |   |      | 2,890,897
|Deposits                                                      |  |      | 5,632,328 |      |   | 3,185,552 |   |      | 2,356,074
|Long-term   obligations                                       |  |      | 309,421   |      |   | 233,045   |   |      | 83,322   
|Shareholders
equity                                          |  |      | 630,401   |      |   | 563,446   |   |      | 504,576  
|                                                              |  |      |           |      |   |           |   |      |          
|AT YEAR-END                                                   |  |      |           |      |   |           |   |      |          
|Assets                                                        |  | $    | 8,458,740 |      | $ | 5,017,787 |   | $    | 3,643,830
|Loans,   net of unearned income                               |  |      | 4,524,511 |      |   | 2,793,828 |   |      | 2,433,771
|Earning   assets                                              |  |      | 8,292,149 |      |   | 4,946,297 |   |      | 3,560,421
|Deposits                                                      |  |      | 7,275,346 |      |   | 4,100,152 |   |      | 2,846,402
|Long-term   obligations                                       |  |      | 377,404   |      |   | 260,658   |   |      | 207,500  
|Shareholders
equity                                          |  |      | 689,775   |      |   | 599,591   |   |      | 546,180  
|                                                              |  |      |           |      |   |           |   |      |          
|(CHARGE-OFFS)/RECOVERIES    COMMERCIAL REAL ESTATE LOANS (2) |  |      |           |      |   |           |   |      |          
|Charge-offs                                                   |  | $    |          |      | $ |          |   | $    |         
|Recoveries                                                    |  |      |          |      |   |          |   |      |         
|                                                              |  |      |           |      |   |           |   |      |          
|Net (Charge-offs)/Recoveries                                  |  | $    |          |      | $ |          |   | $    |         
|                                                              |  |      |           |      |   |           |   |      |          
|SIGNIFICANT   RATIOS                                          |  |      |           |      |   |           |   |      |          
|Return   on average assets                                    |  |      | 2.1       | %    |   | 2.4       | % |      | 2.0      
|Return   on average equity                                    |  |      | 21.8      | %    |   | 17.4      | % |      | 11.6     
|Efficiency   ratio (3)                                        |  |      | 22.9      | %    |   | 33.5      | % |      | 37.5     
|Net   interest margin                                         |  |      | 3.9       | %    |   | 3.9       | % |      | 4.3      
|(Past   due, nonaccrual,
TDR)
/Total loans                    |  |      | 0.3       | %    |   | 1.0       | % |      | 0.6      
|Allowance   for loan losses/(Past due, nonaccrual, TDR)       |  |      | 259.0     | %    |   | 112.5     | % |      | 234.1    
|Allowance   for loan losses/Total loans                       |  |      | 0.9       | %    |   | 1.2       | % |      | 1.5      
|                                                              |  |      |           |      |   |           |   |      |          
|CAPITAL   RATIOS                                              |  |      |           |      |   |           |   |      |          
|Tier   1 leverage                                             |  |      | 10.7      | %    |   | 15.7      | % |      | 18.7     
|Tier   1 risk-based capital                                   |  |      | 11.5      | %    |   | 15.4      | % |      | 17.9     
|Total   risk-based capital                                    |  |      | 14.4      | %    |   | 18.5      | % |      | 20.5     
|                                                              |  |      |           |      |   |           |   |      |          
|COMMON   SHARE DATA (1)                                       |  |      |           |      |   |           |   |      |          
|Weighted   average fully diluted shares                       |  |      | 28,855    |      |   | 28,818    |   |      | 28,703   
|Common   shares outstanding at year-end                       |  |      | 27,925    |      |   | 27,796    |   |      | 28,037   
|                                                              |  |      |           |      |   |           |   |      |          

|(1) | All   amounts have been restated to reflect a 100% stock dividend on 12/15/03.                                                                                                                                                          
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) | This   section contains charge-off/recovery history for commercial real estate loans   only and is not representative of the total charge-off/recovery history for   all loan types.                                                    
|(3) | Total   noninterest expense less goodwill amortization divided by the sum of fully   taxable equivalent net interest income and noninterest income excluding   securities gains and losses and one-time gains on the sale of businesses.

72CORUS BANKSHARES 2005 ANNUAL REPORT

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|YEARS ENDED DECEMBER 31                                       |  | 2001 |           | 2000 |   | 1999      |   | 1998 |           | 1997 |   | 1996      |  
|------------------------------------------------------------- |  | ---- | --------- | ---- | - | --------- | - | ---- | --------- | ---- | - | --------- | -
|                                                              |  |      |           |      |   |           |   |      |           |      |   |           |  
|(dollars in thousands, except per share   data)               |  |      |           |      |   |           |   |      |           |      |   |           |  
|CONDENSED   INCOME STATEMENTS                                 |  |      |           |      |   |           |   |      |           |      |   |           |  
|Net   interest income                                         |  | $    | 107,709   |      | $ | 121,051   |   | $    | 106,131   |      | $ | 98,220    |  
|Provision   for credit losses                                 |  |      |          |      |   |          |   |      |          |      |   | 10,000    |  
|Noninterest   income                                          |  |      | 25,716    |      |   | 47,260    |   |      | 18,948    |      |   | 25,666    |  
|Noninterest   expense                                         |  |      | 51,100    |      |   | 54,654    |   |      | 63,096    |      |   | 51,889    |  
|                                                              |  |      |           |      |   |           |   |      |           |      |   |           |  
|Income   Before Income Taxes                                  |  |      | 82,325    |      |   | 113,657   |   |      | 61,983    |      |   | 61,997    |  
|Income   tax expense                                          |  |      | 28,142    |      |   | 38,903    |   |      | 21,257    |      |   | 21,369    |  
|                                                              |  |      |           |      |   |           |   |      |           |      |   |           |  
|Net Income                                                    |  | $    | 54,183    |      | $ | 74,754    |   | $    | 40,726    |      | $ | 40,628    |  
|                                                              |  |      |           |      |   |           |   |      |           |      |   |           |  
|SELECTED   PER SHARE DATA (1)                                 |  |      |           |      |   |           |   |      |           |      |   |           |  
|Diluted   earnings                                            |  | $    | 1.89      |      | $ | 2.62      |   | $    | 1.41      |      | $ | 1.38      |  
|Cash   dividends declared on common stock                     |  |      | 0.308     |      |   | 0.298     |   |      | 0.288     |      |   | 0.278     |  
|Book   value at year-end                                      |  |      | 15.92     |      |   | 14.23     |   |      | 11.41     |      |   | 10.93     |  
|Market   price at year-end                                    |  |      | 22.70     |      |   | 24.74     |   |      | 12.00     |      |   | 16.13     |  
|                                                              |  |      |           |      |   |           |   |      |           |      |   |           |  
|AVERAGES                                                      |  |      |           |      |   |           |   |      |           |      |   |           |  
|Assets                                                        |  | $    | 2,672,971 |      | $ | 2,518,960 |   | $    | 2,530,782 |      | $ | 2,417,647 |  
|Loans,   net of unearned income                               |  |      | 1,615,665 |      |   | 1,807,453 |   |      | 1,640,101 |      |   | 1,525,349 |  
|Earning   assets                                              |  |      | 2,577,433 |      |   | 2,398,989 |   |      | 2,419,667 |      |   | 2,311,562 |  
|Deposits                                                      |  |      | 2,160,333 |      |   | 2,081,986 |   |      | 2,115,575 |      |   | 2,031,198 |  
|Long-term   obligations                                       |  |      | 36,668    |      |   | 40,000    |   |      | 40,000    |      |   | 40,000    |  
|Shareholders
equity                                          |  |      | 424,427   |      |   | 346,880   |   |      | 326,776   |      |   | 295,854   |  
|                                                              |  |      |           |      |   |           |   |      |           |      |   |           |  
|AT YEAR-END                                                   |  |      |           |      |   |           |   |      |           |      |   |           |  
|Assets                                                        |  | $    | 2,659,322 |      | $ | 2,598,467 |   | $    | 2,378,544 |      | $ | 2,577,460 |  
|Loans,   net of unearned income                               |  |      | 1,475,245 |      |   | 1,551,880 |   |      | 1,727,357 |      |   | 1,551,587 |  
|Earning   assets                                              |  |      | 2,507,403 |      |   | 2,458,499 |   |      | 2,265,687 |      |   | 2,470,865 |  
|Deposits                                                      |  |      | 2,121,456 |      |   | 2,107,630 |   |      | 1,964,420 |      |   | 2,154,676 |  
|Long-term   obligations                                       |  |      | 48,000    |      |   | 40,000    |   |      | 40,000    |      |   | 40,000    |  
|Shareholders
equity                                          |  |      | 450,886   |      |   | 402,353   |   |      | 327,825   |      |   | 318,130   |  
|                                                              |  |      |           |      |   |           |   |      |           |      |   |           |  
|(CHARGE-OFFS)/RECOVERIES    COMMERCIAL REAL ESTATE LOANS (2) |  |      |           |      |   |           |   |      |           |      |   |           |  
|Charge-offs                                                   |  | $    |          |      | $ |          |   | $    | (61       | )    | $ | (18       | )
|Recoveries                                                    |  |      | 10        |      |   | 42        |   |      | 123       |      |   | 166       |  
|                                                              |  |      |           |      |   |           |   |      |           |      |   |           |  
|Net (Charge-offs)/Recoveries                                  |  | $    | 10        |      | $ | 42        |   | $    | 62        |      | $ | 148       |  
|                                                              |  |      |           |      |   |           |   |      |           |      |   |           |  
|SIGNIFICANT   RATIOS                                          |  |      |           |      |   |           |   |      |           |      |   |           |  
|Return   on average assets                                    |  |      | 2.0       | %    |   | 3.0       | % |      | 1.6       | %    |   | 1.7       | %
|Return   on average equity                                    |  |      | 12.8      | %    |   | 21.6      | % |      | 12.5      | %    |   | 13.7      | %
|Efficiency   ratio (3)                                        |  |      | 40.1      | %    |   | 38.1      | % |      | 41.0      | %    |   | 41.5      | %
|Net   interest margin                                         |  |      | 4.3       | %    |   | 5.1       | % |      | 4.5       | %    |   | 4.3       | %
|(Past   due, nonaccrual,
TDR)
/Total loans                    |  |      | 0.4       | %    |   | 0.3       | % |      | 0.7       | %    |   | 1.1       | %
|Allowance   for loan losses/(Past due,nonaccrual, TDR)        |  |      | 697.5     | %    |   | 769.8     | % |      | 255.7     | %    |   | 206.4     | %
|Allowance   for loan losses/Total loans                       |  |      | 2.7       | %    |   | 2.6       | % |      | 1.9       | %    |   | 2.3       | %
|                                                              |  |      |           |      |   |           |   |      |           |      |   |           |  
|CAPITAL   RATIOS                                              |  |      |           |      |   |           |   |      |           |      |   |           |  
|Tier 1 leverage                                               |  |      | 15.4      | %    |   | 14.0      | % |      | 11.9      | %    |   | 10.3      | %
|Tier   1 risk-based capital                                   |  |      | 19.4      | %    |   | 16.0      | % |      | 15.3      | %    |   | 15.0      | %
|Total   risk-based capital                                    |  |      | 22.0      | %    |   | 18.6      | % |      | 17.8      | %    |   | 18.1      | %
|                                                              |  |      |           |      |   |           |   |      |           |      |   |           |  
|COMMON   SHARE DATA (1)                                       |  |      |           |      |   |           |   |      |           |      |   |           |  
|Weighted   average fully diluted shares                       |  |      | 28,619    |      |   | 28,605    |   |      | 28,928    |      |   | 29,547    |  
|Common   shares outstanding at year-end                       |  |      | 28,319    |      |   | 28,286    |   |      | 28,739    |      |   | 29,102    |  
|                                                              |  |      |           |      |   |           |   |      |           |      |   |           |  

CORUS BANKSHARES 2005 ANNUAL REPORT     73

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DIRECTORS and EXECUTIVE OFFICERS

|DIRECTORS
|---------
|         

|Joseph C. Glickman                       | Robert J. Buford                         | Michael J. McClure*                  
|---------------------------------------- | ---------------------------------------- | -------------------------------------
|Chairman   of the Board,                 | President   and Chief Executive Officer, | Financial   Consultant               
|Corus   Bankshares, Inc.                 | Planned   Equities, Inc.                 |                                      
|                                         | Planned   Realty Group, Inc.             |                                      
|                                         |                                          |                                      
|Robert J.Glickman                        | Kevin R. Callahan*                       | Peter C. Roberts                     
|President   and Chief Executive Officer, | Chief   Executive Officer,               | Chief   Executive Officer  Americas,
|Corus   Bankshares, Inc.                 | Affirmative   Holdings, Inc.             | Jones   Lang LaSalle, Inc.           
|                                         |                                          |                                      
|                                         | Rodney D. Lubeznik*                      |                                      
|                                         | President   and Chief Executive Officer, |                                      
|                                         | Restaurant   Management Corp.            |                                      

|* | Audit   Committee Member
|- | ------------------------

74     CORUS BANKSHARES 2005 ANNUAL REPORT

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Table of Contents

|EXECUTIVE OFFICERS
|------------------
|                  

|Robert J. Glickman                      | Michael E. Dulberg                   | Joel C. Solomon              
|--------------------------------------- | ------------------------------------ | -----------------------------
|President   and Chief Executive Officer | Senior   Vice President and          | Senior   Vice President     
|                                        | Chief   Accounting Officer           | Commercial   Lending         
|                                        |                                      |                              
|Randy P. Curtis                         |                                      | Timothy J. Stodder           
|Executive   Vice President             | Michael W. Jump                      | Senior   Vice President     
|Retail   Banking                        | Senior   Vice President  Operations | Commercial   Lending         
|                                        |                                      |                              
|Michael G. Stein                        | Terence W. Keenan                    | Lori B. Neiman               
|Executive   Vice President             | Senior   Vice President             | First   Vice President      
|Commercial   Lending                    | Commercial   Lending                 | Commercial   Lending         
|                                        |                                      |                              
|Timothy H. Taylor                       | Richard J. Koretz                    | Daniel A. Niedermeyer        
|Executive   Vice President and          | Senior   Vice President  Finance    | First   Vice President      
|Chief   Financial Officer               |                                      | Consumer   Lending/Operations

|SENIOR OFFICERS
|---------------
|               

|John M. Barkidjija                  | Yolanda M. Deen                         | Marilyn Klehm Martin                   
|----------------------------------- | --------------------------------------- | ---------------------------------------
|Senior   Vice President            | First   Vice President  Retail Banking | First   Vice President  Operations    
|Commercial   Lending                |                                         |                                        
|                                    |                                         |                                        
|Brian J. Brodeur                    | Dwight L. Frankfather                   | Mary Kay Phillips                      
|Senior   Vice President            | First   Vice President                 | First   Vice President  Retail Banking
|Commercial   Lending                | Commercial   Lending                    |                                        
|                                    |                                         |                                        
|John R. Markowicz                   | Peter R. Freund                         | David R. Ploger                        
|Senior   Vice President            | First   Vice President                 | First   Vice President                
|Commercial   Lending                | Commercial   Lending                    | Commercial   Lending                   
|                                    |                                         |                                        
|Janice Bake                         | Mary S. Koehler                         | Daniel P. Semenak                      
|First   Vice President  Operations | First   Vice President  Retail Banking | First   Vice President  Finance       

CORUS BANKSHARES 2005 ANNUAL REPORT     75

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Table of Contents

Shareholder Information

|                                                                                                |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|----------------------------------------------------------------------------------------------- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|CORPORATE   OFFICES                                                                             |  | ACCESS TO   REPORTS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|                                                                                                |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|3959 N. Lincoln Avenue   Chicago, Illinois 60613   Telephone (773) 832-3088   www.corusbank.com |  | The Companys Annual Report on Form 10-K,
quarterly reports on Form 10-Q, current reports on Form 8-K, and all amendments
to those reports are made available free of charge through the Companys
Web site at www.corusbank.com as soon as reasonably practicable after such
material is electronically filed with or furnished to the Securities and
Exchange Commission. Copies will be available upon written request to the Chief
Financial Officer of the Company. A charge will be made for exhibits
requested.

|                           |  |                              |                         
|-------------------------- |  | ---------------------------- | ------------------------
|ANNUAL   MEETING           |  | North Shore Skokie Hotel   & | 9599 Skokie Boulevard   
|10:00 a.m., April 18, 2006 |  | Executive Meeting Center     | Skokie, Illinois 60077  
|                           |  |                              |                         
|                           |  |                              | Telephone (847) 679-7000

| |  |                                                                                                                
| |  | ---------------------------------------------------------------------------------------------------------------
| |  | TRANSFER   AGENT AND REGISTRAR                                                                                 
| |  |                                                                                                                
| |  | Mellon Investor Services   LLC                                                                                 
| |  | 480 Washington Boulevard                                                                                       
| |  | Jersey City, New Jersey   07310-1900                                                                           
| |  |                                                                                                                
| |  | (866) 282-3050 Toll-free   number for shareholders                                                             
| |  |                                                                                                                
| |  | (800) 231-5469 TDD   (Telecommunications Device for the Deaf) number for hearing/speech impaired   shareholders
| |  |                                                                                                                
| |  | Mellon Web site:   www.melloninvestor.com/isd                                                                  
| |  |                                                                                                                
| |  | Mellon E-mail Contact:   shrrelations@mellon.com                                                               

76     CORUS BANKSHARES 2005 ANNUAL REPORT

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